I would
like to thank the hundreds of people from all over the world that emailed me
positive feedback throughout 2003 with respect to my research and Internet
based essay on the Iraq war. Based on your overwhelmingly positive feedback and
my own sense of patriotic duty, I am currently writing a book based on this
research. Additionally, I am also working with a former government economist to
construct an empirical model studying the possible effects of the dollar's
valuation in response to a euro currency pricing mechanism for OPEC producers.
The results of will hopefully be included in the proposed forthcoming book,
tentatively entitled: Petrodollar Warfare: Oil, Iraq, and the Future of the
Dollar (Available Fall 2004).

For those
who are already familiar with my original pre-war essay from January and March
2003, you may want to skip the opening parts of this essay and review the
expanded section explaining the importance of Hydrocarbons regarding Peak oil
and US Geostrategy, and then review my somewhat lengthy update from January 1,
2004. The main flaw from my original essay a year ago was an excessive focus on
the macroeconomic perspectives of the Iraq war. In this essay, and in the
forthcoming book, I have attempted to remedy this deficiency by including a
detailed analysis of the oil depletion/geostrategic aspects, which appear to be
second coalescing factor that lead to the Iraq war. For comments email:
wrc92@aol.com.

Summary

Although
completely unreported by the U.S. media and government, the answer to the Iraq
enigma is simple yet shocking -- it is in large part an oil currency
war. One of the core reasons for this upcoming war is this administration's
goal of preventing further Organization of the Petroleum Exporting Countries
(OPEC) momentum towards the euro as an oil transaction currency standard.
However, in order to pre-empt OPEC, they need to gain geo-strategic control of
Iraq along with its 2nd largest proven oil reserves. The second coalescing
factor that is driving the Iraq war is the quiet acknowledgement by respected
oil geologists and possibly this administration is the impending phenomenon
known as Global "Peak Oil." This is projected to occur around 2010,
with Iraq and Saudi Arabia being the final two nations to reach peak oil
production. The issue of Peak Oil has been added to the scope of this essay,
along with the macroeconomics of `petrodollar recycling' and the unpublicized
but genuine challenge to U.S. dollar hegemony from the euro as an alternative
oil transaction currency. The author advocates graduated reform of the global
monetary system including a dollar/euro currency `trading band' with reserve
status parity, a dual OPEC oil transaction standard, and multilateral treaties
via the UN regarding energy reform. Such reforms could potentially reduce
future oil currency and oil warfare. The essay ends with a reflection and
critique of current US economic and foreign policies. What happens in the 2004
US elections will have a large impact on the 21st century.

Revisited -- The Real Reasons for the Upcoming War
With Iraq:
A Macroeconomic and Geostrategic Analysis of the Unspoken Truth

"If
a nation expects to be ignorant and free, it expects what never was and never
will be . . . The People cannot be safe without information. When the press is
free, and every man is able to read, all is safe."

Those
words by Thomas Jefferson embody the unfortunate state of affairs that have
beset our nation. As our government prepares to go to war with Iraq, our
country seems unable to answer even the most basic questions about this upcoming
conflict. First, why is there a lack of a broad international coalition for
toppling Saddam? If Iraq's old weapons of mass destruction (WMD) program truly
possessed the threat level that President Bush has repeatedly purported, why
are our historic allies not joining a coalition to militarily disarm Saddam?
Secondly, despite over 400 unfettered U.N inspections, there has been no
evidence reported that Iraq has reconstituted its WMD program. Indeed, the Bush
administration's claims about Iraq's WMD capability appear demonstrably
false. [1][2] Third, and despite President
Bush's repeated claims, the CIA has not found any links between Saddam Hussein
and Al Qaeda. To the contrary, some intelligence analysts believe it is more
likely Al Qaeda might acquire an unsecured former Soviet Union Weapon(s) of
Mass Destruction, or potentially from sympathizers within a destabilized
Pakistan.

Moreover,
immediately following Congress's vote on the Iraq Resolution, we suddenly
became informed of North Korea's nuclear program violations. Kim Jong Il is
processing uranium in order to produce nuclear weapons this year. (It should be
noted that just after coming into office President Bush was informed in January
2001of North Korea's suspected nuclear program). Despite the obvious
contradictions, President Bush has not provided a rationale answer as to why
Saddam's seemingly dormant WMD program possesses a more imminent threat that
North Korea's active nuclear weapons program. Millions of people in the U.S.
and around the world are asking the simple question: "Why attack Iraq
now?" Well, behind all the propaganda is a simple truth -- one of the core
drivers for toppling Saddam is actually the euro currency, the -- .

Although
apparently suppressed in the U.S. media, one of the answers to the Iraq enigma
is simple yet shocking. The upcoming war in Iraq war is mostly about how the
CIA, the Federal Reserve and the Bush/Cheney administration view hydrocarbons
at the geo-strategic level, and the unspoken but overarching macroeconomic
threats to the U.S. dollar from the euro. The Real Reasons for this upcoming
war is this administration's goal of preventing further OPEC momentum towards
the euro as an oil transaction currency standard, and to secure control of
Iraq's oil before the onset of Peak Oil (predicted to occur around 2010).
However, in order to pre-empt OPEC, they need to gain geo-strategic control of
Iraq along with its 2nd largest proven oil reserves. This essay will discuss
the macroeconomics of the `petrodollar' and the unpublicized but real threat to
U.S. economic hegemony from the euro as an alternative oil transaction
currency. The following is how an individual very well versed in the nuances of
macroeconomics alluded to the unspoken truth about this upcoming war with Iraq:

"The
Federal Reserve's greatest nightmare is that OPEC will switch its international
transactions from a dollar standard to a euro standard. Iraq actually made this
switch in Nov. 2000 (when the euro was worth around 82 cents), and has actually
made off like a bandit considering the dollar's steady depreciation against the
euro. (Note: the dollar declined 17% against the euro in 2002.)

"The
real reason the Bush administration wants a puppet government in Iraq -- or
more importantly, the reason why the corporate-military-industrial network
conglomerate wants a puppet government in Iraq -- is so that it will revert
back to a dollar standard and stay that way." (While also hoping to veto
any wider OPEC momentum towards the euro, especially from Iran -- the 2nd
largest OPEC producer who is actively discussing a switch to euros for its oil
exports)."

Although
a collective switch by OPEC would be extremely unlikely barring a major panic
on the U.S. dollar, it would appear that a gradual transition is quite
plausible. Furthermore, despite Saudi Arabia being our `client state,' the
Saudi regime appears increasingly weak/threatened from massive civil unrest.
Some analysts believe civil unrest might unfold in Saudi Arabia, Iran and other
Gulf states in the aftermath of an unpopular U.S. invasion and occupation of
Iraq [3]. Undoubtedly, the Bush
administration is acutely aware of these risks. Hence, the neo-conservative
framework entails a large and permanent military presence in the Persian Gulf
region in a post-Saddam era, just in case we need to surround and control
Saudi's large Ghawar oil fields in the event of a Saudi coup by an anti-western
group. But first back to Iraq.

"Saddam
sealed his fate when he decided to switch to the euro in late 2000 (and later
converted his $10 billion reserve fund at the U.N. to euros) -- at that point,
another manufactured Gulf War become inevitable under Bush II. Only the most
extreme circumstances could possibly stop that now and I strongly doubt
anything can -- short of Saddam getting replaced with a pliant regime.

"Big
Picture Perspective: Everything else aside from the reserve currency and the
Saudi/Iran oil issues (i.e. domestic political issues and international
criticism) is peripheral and of marginal consequence to this administration.
Further, the dollar-euro threat is powerful enough that they will rather risk
much of the economic backlash in the short-term to stave off the long-term
dollar crash of an OPEC transaction standard change from dollars to euros. All
of this fits into the broader Great Game that encompasses Russia, India,
China."

This
information about Iraq's oil currency is not discussed by the U.S. media or the
Bush administration as the truth could potentially curtail both investor and
consumer confidence, reduce consumer borrowing/spending, create political
pressure to form a new energy policy that slowly weans us off Middle-Eastern
oil, and of course stop our march towards a war with Iraq. This quasi `state
secret' is addressed in a Radio Free Europe article that discussed Saddam's
switch for his oil sales from dollars to the euros, to be effective November 6,
2000:

"Baghdad's
switch from the dollar to the euro for oil trading is intended to rebuke
Washington's hard-line on sanctions and encourage Europeans to challenge it.
But the political message will cost Iraq millions in lost revenue. RFE/RL
correspondent Charles Recknagel looks at what Baghdad will gain and lose, and
the impact of the decision to go with the European currency." [4]

At the
time of the switch many analysts were surprised that Saddam was willing to give
up approximately $270 million in oil revenue for what appeared to be a
political statement. However, contrary to one of the main points of this
November 2000 article, the steady depreciation of the dollar versus the euro
since late 2001 means that Iraq has profited handsomely from the switch in
their reserve and transaction currencies. Indeed, The Observer
surprisingly divulged these facts in a recent article entitled: `Iraq nets
handsome profit by dumping dollar for euro,' (February 16, 2003).

"A
bizarre political statement by Saddam Hussein has earned Iraq a windfall of
hundreds of millions of euros. In October 2000 Iraq insisted upon dumping the
US Dollar -- `the currency of the enemy' -- for the more multilateral
euro." [5]

Although
Iraq's oil currency switch appears to be completely censored by the U.S. media
conglomerates, this UK article illustrates that the euro has gained almost 25%
against the dollar since late 2001, which also applies to the $10 billion in
Iraq's U.N. `oil for food' reserve fund that was previously held in dollars has
also gained that same percent value since the switch. It was reported in 2003
that Iraq's UN reserve fund had swelled from $10 billion dollars to 26
billion euros. According to a former government analyst, the following scenario
would occur if OPEC made an unlikely, but sudden (collective) switch to euros,
as opposed to a gradual transition.

"Otherwise,
the effect of an OPEC switch to the euro would be that oil-consuming nations
would have to flush dollars out of their (central bank) reserve funds and
replace these with euros. The dollar would crash anywhere from 20-40% in value
and the consequences would be those one could expect from any currency collapse
and massive inflation (think Argentina currency crisis, for example). You'd
have foreign funds stream out of the U.S. stock markets and dollar denominated
assets, there'd surely be a run on the banks much like the 1930s, the current
account deficit would become unserviceable, the budget deficit would go into
default, and so on. Your basic 3rd world economic crisis scenario.

"The
United States economy is intimately tied to the dollar's role as reserve
currency. This doesn't mean that the U.S. couldn't function otherwise, but that
the transition would have to be gradual to avoid such dislocations (and the
ultimate result of this would probably be the U.S. and the E.U. switching roles
in the global economy)."

Although
the above scenario is unlikely, and most assuredly undesirable, under certain
economic conditions it is plausible. In fact, one of the conditions that could
create such an environment is a near unilateral U.S. led war in the Middle
East. For example, a large spike in oil prices could create huge problems for
the imperiled Japanese banking system, the world's largest holder of U.S.
dollar reserves. Unfortunately the current Bush administration has chosen a
military option instead of a multilateral conference on monetary reform to
resolve these issues. In the aftermath of toppling Saddam it is clear the U.S.
will keep a large and permanent military force in the Persian Gulf. Indeed,
there is no talk of an `exit strategy,' as the military will be needed to
protect the newly installed regime, and to send a message to other OPEC
producers that they too might receive `regime change' if they convert their oil
payments to euros.

An
interesting yet again underreported story from last year relates to another
OPEC `Axis of Evil' country, Iran, who is vacillating on pricing their oil
export in the euro currency.

"Iran's
proposal to receive payments for crude oil sales to Europe in euros instead of
U.S. dollars is based primarily on economics, Iranian and industry sources
said.

"But
politics are still likely to be a factor in any decision, they said, as Iran
uses the opportunity to hit back at the U.S. government, which recently labeled
it part of an `axis of evil.'

"The
proposal, which is now being reviewed by the Central Bank of Iran, is likely to
be approved if presented to the country's parliament, a parliamentary
representative said.

"`There
is a very good chance MPs will agree to this idea . . . now that the euro is
stronger, it is more logical,' the parliamentary representative
said." [6]

Moreover,
and perhaps most telling, during 2002 the majority of reserve funds in Iran's
central bank were shifted to euros. It appears imminent they intend to switch
oil payments to euros.

"More
than half of [Iran] the country's assets in the Forex Reserve Fund have been
converted to euro, a member of the Parliament Development Commission, Mohammad
Abasspour announced. He noted that higher parity rate of euro against the US
dollar will give the Asian countries, particularly oil exporters, a chance to
usher in a new chapter in ties with European Union's member countries.

"He
said that the United States dominates other countries through its currency,
noting that given the superiority of the dollar against other hard currencies,
the US monopolizes global trade. The lawmaker expressed hope that the
competition between euro and dollar would eliminate the monopoly in global
trade." [7]

After
toppling Saddam, this administration may decide that Iran's disloyalty to the
dollar qualifies them as the next target in the `war on terror.' Iran's
interest in switching to the euro as their currency for oil exports is well
documented. Perhaps U.S. operations against Iran will be mostly covert, but
this MSNBC article alludes to ultimate objectives of the
neo-conservatives.

"While
still wrangling over how to overthrow Iraq's Saddam Hussein, the Bush
administration is already looking for other targets. President Bush has called
for the ouster of Palestinian leader Yasir Arafat. Now some in the
administration -- and allies at D.C. think tanks -- are eyeing Iran and even
Saudi Arabia. As one senior British official put it: `Everyone wants to go to
Baghdad. Real men want to go to Tehran.'" [8]

Aside
from the geopolitical risks regarding Saudi Arabia and Iran, another risk
factor is actually Japan. Perhaps the biggest gamble in a protracted Iraq war
may be Japan's weak economy. [9] If the war creates prolonged oil
high prices ($45 per barrel over several months), or a short but massive oil
price spike ($80 to $100 per barrel), some analysts believe Japan's fragile
economy would collapse. Japan is quite hypersensitive to oil prices, and if its
banks default, the collapse of the second largest economy would set in motion a
sequence of events that could prove quite damaging to the U.S. economy. There
is little doubt the Iraq war plan is designed to be a quick victory, with the
U.S. military securing Iraq's vital oil fields at the very onset of
hostilities.

Nonetheless,
other risks might arise if the Iraq war goes poorly or becomes prolonged. It is
possible that civil unrest may unfold in Iran, Saudi Arabia or other OPEC
members in the Middle East. Such events could foster the very situation this
administration is trying to prevent: another OPEC member switching to euros as
their oil transaction currency standard.

Incidentally,
the final `Axis of Evil' country, North Korea, recently decided to officially
drop the dollar and begin using euros for trade, effective Dec. 7, 2002. [10] Unlike the OPEC-producers, North
Korea's switch will have negligible economic impact, but it illustrates the
geopolitical fallout of President Bush's harsh rhetoric. Much more troubling is
North Korea's recent action following the oil embargo of their country. They
are in dire need of oil and food; and in an act of desperation they have
re-activated their pre-1994 nuclear program. The re-processing uranium fuel
rods appear to be taking place, and it appears their strategy is to prompt
negotiations with the U.S. regarding food and oil. The CIA estimates that North
Korea could produce 4-6 nuclear weapons by the second half of 2003. Ironically,
this crisis over North Korea's nuclear program further confirms the fraudulent
premise for which this war with Saddam was entirely contrived.

During
the 1990s the world viewed the U.S. as a rather self-absorbed but essentially
benevolent superpower. Military actions in Iraq (1990-91 & 1998), Serbia
and Kosovo (1999) were undertaken with NATO cooperation and UN involvement,
thereby affording these operations with a sufficient level of international
legitimacy. President Clinton also worked to reduce tensions in Northern
Ireland and attempted to negotiate a resolution to the Israeli-Palestinian
conflict. With the exception of the Middle East, our superpower status was
viewed as mostly benign. Our trade imbalances were tolerated, and balanced
fiscal policies provided confidence.

However,
in both the pre and post 9/11 intervals, the `America first' policies of the
Bush administration, with its unwillingness to honor International Treaties,
along with their aggressive militarisation of foreign policy has significantly
damaged our reputation abroad. Following 9/11, it appears that President Bush's
`warmongering rhetoric' has created global tensions -- as we are now viewed as
a belligerent superpower willing to apply unilateral military force without
U.N. approval. Moreover, this administrations failure to actively engage in
negotiations regarding the Israeli/Palestinian conflict is unfortunate.
Lamentably, the tremendous amount of international sympathy we witnessed in the
immediate aftermath of the September 11th tragedy has been replaced with fear
and anger at our government. This administration's bellicosity has changed the
worldview, and `anti-Americanism' is proliferating even among our closest
allies. [11]

Equally
alarming, and completely unreported in the US media, are significant monetary
shifts in the reserve funds of foreign governments away from the dollar with
movements towards the euro. [12][13][14] It appears the world community
may lack faith in the Bush administration's flawed economic policies, and along
with OPEC, seem poised to respond with economic retribution if the U.S.
government is regarded as an uncontrollable and dangerous superpower. Despite
the absence of media coverage, the plausibility of slowly abandoning the dollar
standard for the euro is real. An article by Hazel Henderson outlines the
dynamics and the potential outcomes:

"The
most likely end to US hegemony may come about through a combination of high oil
prices (brought about by US foreign policies toward the Middle East) and deeper
devaluation of the US dollar (expected by many economists). Some elements of
this scenario:

1.US global
over-reach in the `war on terrorism' already leading to deficits as far as the
eye can see -- combined with historically-high US trade deficits -- lead to a
further run on the dollar. This and the stock market doldrums make the US less
attractive to the world's capital.

2.More
developing countries follow the lead of Venezuela and China in diversifying
their currency reserves away from dollars and balanced with euros. Such a shift
in dollar-euro holdings in Latin America and Asia could keep the dollar and
euro close to parity.

3.OPEC
could act on some of its internal discussions and decide (after concerted
buying of euros in the open market) to announce at a future meeting in Vienna
that OPEC's oil will be re-denominated in euros, or even a new oil-backed
currency of their own. A US attack on Iraq sends oil to 40
(euros) per barrel.

4.The Bush
Administration's efforts to control the domestic political agenda backfires.
Damage over the intelligence failures prior to 9/11 and warnings of imminent
new terrorist attacks precipitate a further stock market slide.

5.All
efforts by Democrats and the 57% of the US public to shift energy policy toward
renewables, efficiency, standards, higher gas taxes, etc. are blocked by the
Bush Administration and its fossils fuel industry supporters. Thus, the USA
remains vulnerable to energy supply and price shocks.

6.The EU
recognizes its own economic and political power as the euro rises further and
becomes the world's other reserve currency. The G-8 pegs the euro and dollar
into a trading band -- removing these two powerful currencies from speculators
trading screens (a "win-win" for everyone!). Tony Blair persuades
Brits of this larger reason for the UK to join the euro.

7.Developing
countries lacking dollars or "hard" currencies follow Venezuela's
lead and begin bartering their undervalued commodities directly with each other
in computerized swaps and counter trade deals. President Chavez has inked 13
such country barter deals on its oil, e.g., with Cuba in exchange for Cuban health
paramedics who are setting up clinics in rural Venezuelan villages.

The
result of this scenario? The USA could no longer run its huge current account
trade deficits or continue to wage open-ended global war on terrorism or evil.
The USA ceases pursuing unilateralist policies. A new US administration begins
to return to its multilateralist tradition, ceases its obstruction and rejoins
the UN and pursues more realistic international cooperation." [15]

As for
the events currently taking place in Venezuela, items #2 and #7 on the above
list may allude to why the Bush administration quickly endorsed the failed
military-led coup of Hugo Chavez in April 2002. Although the coup collapsed
after 2 days with Chavez being restored to power, various reports suggest the
CIA and a rather embarrassed Bush administration approved and may have been
actively involved with the civilian/military coup plotters.

"George
W. Bush's administration was the failed coup's primary loser, underscoring its
bankrupt hemispheric policy. Now it is slowly filtering out that in recent
months White House officials met with key coup figures, including Carmona.
Although the administration insists that it explicitly objected to any
extra-constitutional action to remove Chavez, comments by senior U.S. officials
did little to convey this. . . .

"The
CIA's role in a 1971 Chilean strike could have served as the working model for
generating economic and social instability in order to topple Chavez. In the
truckers' strike of that year, the agency secretly orchestrated and financed
the artificial prolongation of a contrived work stoppage in order to
economically asphyxiate the leftist Salvador Allende government.

"This
scenario would have had CIA operatives acting in liaison with the Venezuelan
military, as well as with opposition business and labor leaders, to convert a
relatively minor afternoon-long work stoppage by senior management into a
nearly successful coup de grâce." [16]

Interestingly,
according to an article by Michael Ruppert, Venezuelan's ambassador Francisco
Mieres-Lopez apparently floated the idea of switching to the euro approximately
one year before the failed coup attempt. Furthermore, there is some evidence
that the U.S. is still active in its attempts to overthrow the democratically
elected Chavez administration. In December 2002 a Uruguayan government official
exposed the ongoing covert CIA operations in Venezuela:

"Uruguayan
EP-FA congressman Jose Nayardi says he has information that far-reaching plan
have been put into place by the CIA and other North American intelligence
agencies to overthrow Venezuelan President Hugo Chavez Frias within the next 72
hours. . . .

Nayardi
says he has received copies of top-secret communications between the Bush
administration in Washington and the government of Uruguay requesting the
latter's cooperation to support white collar executives and trade union
activists to `break down levels of intransigence within the Chavez Frias
administration.'" [17]

Venezuela
is the fourth largest producer of oil, and the corporate elites whose political
power runs unfettered in the Bush/Cheney oligarchy appear interested in
privatizing Venezuela's oil industry. Furthermore, the establishment might be
concerned that Chavez's `barter deals' with 12 Latin American countries and
Cuba are effectively cutting the U.S. dollar out of the vital oil transaction
currency cycle. Commodities are being traded among these countries in exchange
for Venezuela's oil, thereby reducing reliance on fiat dollars. If these unique
oil transactions proliferate, they could create more devaluation pressure on
the dollar by removing it from its crucial `petro-recycling' role. Continuing
attempts to remove Hugo Chavez appear likely.

The U.S.
economy has acquired significant structural imbalances, including our record-high
$503 billion trade account deficit (5% of GDP), a $6.9 trillion dollar deficit
(60% of GDP), and the recent return to annual budget deficits in the hundreds
of billions. These imbalances are exacerbated by the Bush administration's
ideologically driven tax and budget policies, which are creating enormous
deficits for the rest of this decade. These factors would significantly devalue
the currency of any other nation under the "rules of economics.' Why is
the dollar still the predominant currency despite these structural imbalances,
and why does it appear immune from our twin deficits? While many Americans
assume the strength of the U.S. dollar merely rests on our economic output
(GDP), the ruling elites understand that the dollar's strength is founded on
two fundamentally unique advantages relative to all other hard currencies.

The
reality is that the "safe harbor" status of the U.S. dollar since
1945 rests on it being the international reserve currency. Thus it has assumed
the role of sole currency for global oil transactions (ie. `petrodollar'). The
U.S. prints hundreds of billions of fiat dollars, which U.S. consumers provide
to other nations via the purchase of imported goods. These dollars become
"petro-dollars" when are then used by those nation states to purchase
oil/energy from OPEC producers (except Iraq, to some degree Venezuela, and
perhaps Iran in the near future). Approximately $600 to $800 billion
`petrodollars' are annually from OPEC and invested back into the U.S. via
Treasury Bills or other dollar-denominated assets such as U.S. stocks, bonds,
real estate, etc. This recycling bolsters the dollar's international liquidity
value.

According
to research by Dr. David Spiro, in 1974 the Nixon administration negotiated
assurances from Saudi Arabia to price oil in dollars only, and invest their
surplus oil proceeds in U.S. Treasury Bills. In return the U.S. would protect
the Saudi regime. According to his book, The Hidden Hand of American
Hegemony: Petrodollar Recycling and International Markets[18], these purchases were done in
relative secrecy. These agreements created the phenomenon known as
"petrodollar recycling." In effect, global oil consumption via OPEC
provides a healthy subsidy to the U.S. economy. Hence, the Europeans created
the euro to compete with the dollar as an alternative international reserve
currency. Obviously the E.U. would also like oil priced in euros as well, as
this would reduce or eliminate their currency risk for oil purchases.

The `old
rules' for valuation of the U.S. dollar currency and economic power were based
on our flexible market, free flow of trade goods, high per worker productivity,
manufacturing output/ trade surpluses, government oversight of accounting
methodologies (ie. SEC), developed infrastructure, education system, and of
course total cash flow and profitability. Our superior military power afforded
some additional confidence in the dollar. While many of these factors remain
present, over the last two decades we have diluted some of the `safe harbor'
economic fundamentals. Despite vast imbalances and structural problems that are
escalating within the U.S. economy, since 1974 the dollar as the monopoly oil
currency created `new rules'. The following excerpts from an Asia Times
article discusses the virtues of our petrodollar hegemony (or vices from the
perspective of developing nations, whose debt is denominated in dollars).

"Ever
since 1971, when US president Richard Nixon took the dollar off the gold
standard (at $35 per ounce) that had been agreed to at the Bretton Woods
Conference at the end of World War II, the dollar has been a global monetary
instrument that the United States, and only the United States, can produce by fiat.
The dollar, now a fiat currency, is at a 16-year trade-weighted high despite
record US current-account deficits and the status of the US as the leading
debtor nation. The US national debt as of April 4 was $6.021 trillion against a
gross domestic product (GDP) of $9 trillion.

"World
trade is now a game in which the US produces dollars and the rest of the world
produces things that dollars can buy. The world's interlinked economies no
longer trade to capture a comparative advantage; they compete in exports to
capture needed dollars to service dollar-denominated foreign debts and to
accumulate dollar reserves to sustain the exchange value of their domestic
currencies. To prevent speculative and manipulative attacks on their
currencies, the world's central banks must acquire and hold dollar reserves in
corresponding amounts to their currencies in circulation. The higher the market
pressure to devalue a particular currency, the more dollar reserves its central
bank must hold. This creates a built-in support for a strong dollar that in
turn forces the world's central banks to acquire and hold more dollar reserves,
making it stronger. This phenomenon is known as dollar hegemony, which is
created by the geopolitically constructed peculiarity that critical commodities,
most notably oil, are denominated in dollars. Everyone accepts dollars because
dollars can buy oil. The recycling of petro-dollars is the price the US has
extracted from oil-producing countries for US tolerance of the oil-exporting
cartel since 1973.

"By
definition, dollar reserves must be invested in US assets, creating a
capital-accounts surplus for the US economy. Even after a year of sharp
correction, US stock valuation is still at a 25-year high and trading at a 56
percent premium compared with emerging markets.

". .
. The US capital-account surplus in turn finances the US trade deficit.
Moreover, any asset, regardless of location, that is denominated in dollars is
a US asset in essence. When oil is denominated in dollars through US state action
and the dollar is a fiat currency, the US essentially owns the world's oil for
free. And the more the US prints greenbacks, the higher the price of US assets
will rise. Thus a strong-dollar policy gives the US a double win." [19]

This
unique geo-political agreement with Saudi Arabia in 1974 has worked to our
favor for the past 30 years, as this arrangement has eliminated our currency
risk for oil, raised the entire asset value of all dollar denominated
assets/properties, and allowed the Federal Reserve to create a truly massive
debt and credit expansion (or `credit bubble' in the view of some economists).
These structural imbalances in the U.S. economy are sustainable as long as:

1.Nations continue to demand and purchase oil for their energy/survival
needs

These
underlying factors, along with the `safe harbor' reputation of U.S. investments
afforded by the dollar's reserve currency status propelled the U.S. to economic
and military hegemony in the post-World War II period. However, the
introduction of the euro is a significant new factor, and appears to be the
primary threat to U.S. economic hegemony. Moreover, in December 2002 ten
additional countries were approved for full membership into the E.U. Barring
any surprise movements, in 2004 this will result in an aggregate E.U. GDP of
$9.6 trillion and 450 million people, directly competing with the U.S. economy
($10.5 trillion GDP, 280 million people).

Especially
interesting is a speech given by Mr Javad Yarjani, the Head of OPEC's Petroleum
Market Analysis Department, in a visit to Spain in April 2002. His speech dealt
entirely with the subject of OPEC oil transaction currency standard with
respect to both the dollar and the euro. The following excerpts from this OPEC
executive provide insights into the conditions that would create momentum for
an OPEC currency switch to the euro. Indeed, his candid analysis warrants
careful consideration given that two of the requisite variables he outlines for
the switch have taken place since this speech in Spring 2002. Articles
regarding the euro and its potential to purchase oil are discussed in the
European and Asian media, but have been completely unreported in the U.S.

". .
. The question that comes to mind is whether the euro will establish itself in
world financial markets, thus challenging the supremacy of the US dollar, and
consequently trigger a change in the dollar's dominance in oil markets. As we
all know, the mighty dollar has reigned supreme since 1945, and in the last few
years has even gained more ground with the economic dominance of the United
States, a situation that may not change in the near future. By the late 90s,
more than four-fifths of all foreign exchange transactions, and half of all
world exports, were denominated in dollars. In addition, the US currency
accounts for about two thirds of all official exchange reserves. The world's
dependency on US dollars to pay for trade has seen countries bound to dollar
reserves, which are disproportionably higher than America's share in global
output. The share of the dollar in the denomination of world trade is also much
higher than the share of the US in world trade.

"Having
said that, it is worthwhile to note that in the long run the euro is not at
such a disadvantage versus the dollar when one compares the relative sizes of
the economies involved, especially given the EU enlargement plans. Moreover,
the Euro-zone has a bigger share of global trade than the US and while the US
has a huge current account deficit, the euro area has a more, or balanced,
external accounts position. One of the more compelling arguments for keeping
oil pricing and payments in dollars has been that the US remains a large
importer of oil, despite being a substantial crude producer itself. However,
looking at the statistics of crude oil exports, one notes that the Euro-zone is
an even larger importer of oil and petroleum products than the US. . . .

". .
. From the EU's point of view, it is clear that Europe would prefer to see
payments for oil shift from the dollar to the euro, which effectively removed
the currency risk. It would also increase demand for the euro and thus help
raise its value. Moreover, since oil is such an important commodity in global
trade, in term of value, if pricing were to shift to the euro, it could provide
a boost to the global acceptability of the single currency. There is also very
strong trade links between OPEC Member Countries (MCs) and the Euro-zone, with
more than 45 percent of total merchandise imports of OPEC MCs coming from the
countries of the Euro-zone, while OPEC MCs are main suppliers of oil and crude
oil products to Europe. . . .

"Of
major importance to the ultimate success of the euro, in terms of the oil
pricing, will be if Europe's two major oil producers -- the United Kingdom and
Norway join the single currency. Naturally, the future integration of these two
countries into the Euro-zone and Europe will be important considering they are
the region's two major oil producers in the North Sea, which is home to the
international crude oil benchmark, Brent. This might create a momentum to shift
the oil pricing system to euros. . . .

"In
the short-term, OPEC MCs, with possibly a few exceptions, are expected to
continue to accept payment in dollars. Nevertheless, I believe that OPEC will
not discount entirely the possibility of adopting euro pricing and payments in
the future. The Organization, like many other financial houses at present, is
also assessing how the euro will settle into its life as a new currency. The
critical question for market players is the overall value and stability of the
euro, and whether other countries within the Union will adopt the single
currency.

"It
is quite possible that as the bilateral trade increases between the Middle East
and the European Union, it could be feasible to price oil in euros considering
Europe is the main economic partner of that region. This would foster further
ties between these trading blocs by increasing commercial exchange, and by
helping attract much-needed European investment to the Middle East.

"In
the long-term, perhaps one question that comes to mind is could a dual system
operate simultaneously? Could one pricing system apply to the Western
Hemisphere in dollars and for the rest of the world in euros? This will remain
the test for the euro, should the currency gain ground in the market of oil
transactions

". .
. Should the euro challenge the dollar in strength, which essentially could
include it in the denomination of the oil bill, it could be that a system may
emerge which benefits more countries in the long-term. Perhaps with increased
European integration and a strong European economy, this may become a reality.
Time may be on your side. I wish the euro every success." [20]

Based on
this important speech, momentum for OPEC to consider switching to the euro will
grow once the E.U. expands in May 2004 to 450 million people with the inclusion
of 10 additional member states. The aggregate GDP will increase from $7 trillion
to $9.6 trillion. This enlarged European Union (EU) will be an oil consuming
purchasing population 33% larger than the U.S., and over half of OPEC crude oil
will be sold to the EU as of mid-2004. This does not include other potential
E.U./euro entrants such as the U.K., Norway, Denmark and Sweden. It should be
noted that since late 2002, the euro has been trading at parity or above the
dollar, and analysts predict the dollar will continue its downward trending in
2003 relative to the euro.

It
appears the final two pivotal items that would create the OPEC transition to
euros will be based on (1) if and when Norway's Brent crude is re-dominated in
euros and (2) when the U.K. adopts the euro. Regarding the later, Tony Blair is
lobbying heavily for the U.K. to adopt the euro, and their adoption would seem
imminent within this decade. If and when the U.K. adopts the euro currency I
suspect a concerted effort will be quickly mounted to establish the euro as an
international reserve currency. Again, I offer the following information from
an astute individual who analyzes these international monetary matters very
carefully:

"The
pivotal vote will probably be Sweden, where approval this next autumn of
adopting the euro also would give momentum to the Danish government's strong
desire to follow suit. Polls in Denmark now indicate that the euro would pass
with a comfortable margin and Norwegian polls show a growing majority in favor
of EU membership. Indeed, with Norway having already integrated most EU
economic directives through the EEA partnership and with their strongly
appreciated currency, their accession to the euro would not only be effortless,
but of great economic benefit.

"As
go the Swedes, so probably will go the Danes & Norwegians. It's the British
who are the real obstacle to building momentum for the euro as international
transaction & reserve currency. So long as the United Kingdom remains apart
from the euro, reducing exchange rate costs between the euro and the British
pound remains their obvious priority. British adoption (a near-given in the
long run) would mount significant pressure toward repegging the Brent crude
benchmark -- which is traded on the International Petroleum Exchange in London
-- and the Norwegians would certainly have no objection whatsoever that I can
think of, whether or not they join the European Union.

"Finally,
the maneuvers toward reducing the global dominance of the dollar are already
well underway and have only reason to accelerate so far as I can see. An OPEC
pricing shift would seem rather unlikely prior 2004 -- barring political
motivations (ie. from anxious OPEC members) or a disorderly collapse of the
dollar (ie. Japanese bank collapse due to high oil prices following a prolonged
Iraq conflict) but appears quite viable to take place before the end of the
decade."

In other
words, beginning around 2004-2008, from a purely economic, trade and monetary
perspective, it will become logical for some OPEC producers to transition to
the euro for oil pricing. Of course that will reduce the dollar's international
demand/liquidity value, and hurt the U.S.'s ability to fund its massive debt
unless U.S. policy makers begin to make difficult fiscal and monetary changes
right away -- or use our massive military power to force events upon OPEC . . .

Facing
these potentialities, I hypothesize that President Bush intends to topple
Saddam in 2003 in a pre-emptive attempt to initiate massive Iraqi oil
production in far excess of OPEC quotas, to reduce global oil prices, and
thereby dismantle OPEC's price controls. The end-goal of the neo-conservatives
is incredibly bold yet simple in purpose, to use the `war on terror' as the
premise to finally dissolve OPEC's decision-making process, thus ultimately
preventing the cartel's inevitable switch to pricing oil in euros. How would
the Bush administration break-up the OPEC cartel's price controls in a
post-Saddam Iraq? First, the newly installed U.S. ruler (Gen. Garner) will
convert Iraq's oil exports back to the dollar standard. Moreover, according to
a Washington Post article just before the Iraq war, one of the
pre-determined decisions of the "Iraqi interim authority" in a
postwar economy is to drop the Iraq dinar, and covert Iraq to the U.S. dollar.

"The
exact role of the authority, when it would begin to take over government
functions, and who would be part of it are still to be determined, according to
other senior administration officials. But they did suggest that in running a
postwar Iraqi economy, the U.S. plans to substitute U.S. dollars for the Iraqi
currency that bears a likeness of President Saddam Hussein." [21]

Obviously
the `dollarization' of Iraq would apply to the vital oil transaction currency
issue, but I do not expect that crucial "detail" to be discussed in
the U.S. media. Following the war, with the U.S. military protecting the oil
fields, the new ruling junta will undertake the necessary steps to significantly
increase production of Iraq oil -- well beyond OPEC's 2 million barrel per day
quota. Analysts have predicted that raising Iraq's oil production back to
pre-1990 levels will take between several months or two years. Nonetheless,
geostrategists such as Henry Kissenger suggested in 1973 that the US should
invade the Middle East, and disband the OPEC cartel. Mr. Robert Dreyfuss
discussed the history of these goals in his article "The Thirty Year
Itch." [22] Dr. Nayyer Ali offers a succinct
analysis of how Iraq's underutilized oil reserves will not be a `profit-maker'
for the U.S. government, but will fulfill the more important Geostrategic goal
of providing the crucial economic instrument to leverage and dissolve OPEC's
price controls, thus fulfilling the long sought-after goal of the
neo-conservatives to disband the OPEC cartel:

". .
. Despite this vast pool of oil, Iraq has never produced at a level
proportionate to the reserve base. Since the Gulf War, Iraq's production has
been limited by sanctions and allowed sales under the oil for food program (by
which Iraq has sold 60 billion dollars worth of oil over the last 5 years) and
what else can be smuggled out. This amounts to less than 1 billion barrels per
year. If Iraq were reintegrated into the world economy, it could allow massive
investment in its oil sector and boost output to 2.5 billion barrels per year,
or about 7 million barrels a day.

"Total
world oil production is about 75 million barrels, and OPEC combined produces
about 25 million barrels.

"What
would be the consequences of this? There are two obvious things.

"First
would be the collapse of OPEC, whose strategy of limiting production to
maximize price will have finally reached its limit. An Iraq that can produce
that much oil will want to do so, and will not allow OPEC to limit it to 2
million barrels per day. If Iraq busts its quota, then who in OPEC will give up
5 million barrels of production? No one could afford to, and OPEC would die.
This would lead to the second major consequence, which is a collapse in the
price of oil to the 10-dollar range per barrel. The world currently uses 25
billion barrels per year, so a 15-dollar drop will save oil-consuming nations
375 billion dollars in crude oil costs every year.

". .
. The Iraq war is not a moneymaker. But it could be an OPEC breaker. That
however is a long-term outcome that will require Iraq to be successfully
reconstituted into a functioning state in which massive oil sector investment
can take place." [23]

The
American people are oblivious to the potential economic risks regarding the
Iraq war. The Bush administration believes that by toppling Saddam they will
remove the juggernaut, thus allowing the US to control Iraqi's huge oil
reserves, and finally break-up and dissolve the 10 remaining countries in OPEC.
However, U.S. occupation of Iraq could exacerbate tensions within OPEC or
perhaps Iran, providing further impetus for momentum for pricing oil in euros.

This last
issue is undoubtedly a significant gamble even in the best-case scenario of a
relatively quick and painless war that topples Saddam and leaves Iraq's oil
fields intact. Undoubtedly, the OPEC cartel could feel threatened by the goal
of the neo-conservatives to break-up OPEC's price controls ($22-$28 per
barrel). Perhaps the Bush administration's ambitious goal of flooding the oil
market with Iraqi crude may work, but I have doubts. Will OPEC simply tolerate
quota-busting Iraqi oil production, thus delivering to them a lesson in
self-inflicted hara-kiri (suicide)? Contrarily, OPEC could meet in Vienna and
in an act of self-preservation re-denominate the oil currency to the euro.
Although unlikely, such a decision would mark the end of U.S. dollar hegemony,
and thus the end of our precarious economic superpower status. Again, I offer
the analysis of an astute observer regarding the colossal gamble this
administration is undertaking:

"One
of the dirty little secrets of today's international order is that the rest of
the globe could topple the United States from its hegemonic status whenever
they so choose with a concerted abandonment of the dollar standard. This is
America's preeminent, inescapable Achilles Heel for now and the foreseeable
future.

"That
such a course hasn't been pursued to date bears more relation to the fact that
other Westernized, highly developed nations haven't any interest to undergo the
great disruptions which would follow -- but it could assuredly take place in
the event that the consensus view coalesces of the United States as any sort of
`rogue' nation. In other words, if the dangers of American global hegemony are
ever perceived as a greater liability than the dangers of toppling the
international order. The Bush administration and the neo-conservative movement
has set out on a multiple-front course to ensure that this cannot take place,
in brief by a graduated assertion of military hegemony atop the existent
economic hegemony."

Regrettably,
under this administration we have returned to massive deficit spending, and the
lack of strong SEC enforcement has further eroded investor confidence. Indeed,
the flawed economic and tax policies and of the Bush administration resulting
in years of projected deficits may be exacerbating the weakness of the dollar,
if not outright hastening some countries to diversify their central bank
reserve funds with euros as an alternative to the dollar. From a foreign policy
perspective, the terminations of numerous international treaties and disdain
for international cooperation via the U.N. and NATO have angered even our
closest allies.

In
September 2002, Dr. Paul Isbell wrote an excellent analysis regarding the quiet
"tectonic shifts" underway with respect the dollar and euro. In his
essay he asked, "What can Europe do to consciously prepare the way for the
day when this tectonic shift in monetary relations becomes undeniably
obvious?" [24] Unfortunately, today we are
witnessing this clash of US/EU financial interests in the form of the upcoming
Iraq war over Saddam's switch to a "petroeuro." Instead of leading a
pre-emptive war in Iraq, the US should be pursuing a multilateral treaty,
perhaps mediated by the UN that establishes a dual-currency standard for OPEC
oil pricing.

Synopsis

It would
appear that any attempt by OPEC member states in the Middle East or Latin
America to transition to the euro as their oil transaction currency standard
shall be met with either overt U.S. military actions or covert U.S.
intelligence agency interventions. Under the guise of the perpetual `war on
terror' the Bush administration is manipulating the American people about the
unspoken but very real macroeconomic reasons for this upcoming war with Iraq.
This war in Iraq will not be based on any threat from Saddam's old WMD program,
or from terrorism. This war will be over the global currency of oil. A war
intended to prevent oil from being priced in euros.

Sadly,
the U.S. has become largely ignorant and complacent. Too many of us are willing
to be ruled by fear and lies, rather than by persuasion and truth. Will we allow
our government to initiate the dangerous `pre-emptive doctrine' by waging an
unpopular war in Iraq, while we refuse to acknowledge that Saddam does not pose
an imminent threat to the United States? Furthermore, we seem unable to address
the structural imbalances in our economy due to massive debt manipulation,
unaffordable 2001 tax cuts, record levels of trade deficits, unsustainable
credit expansion, corporate accounting abuses, near zero personal savings,
record personal indebtedness, and our reliance and over consumption of Middle
Eastern oil.

Regardless
of whatever Dr. Blix finds or does not find in Iraq regarding WMD, it appears
that President Bush is determined to pursue his `pre-emptive' imperialist war
to secure a large portion of the earth's remaining hydrocarbons, and ultimately
use Iraq's underutilized oil to destroy the OPEC cartel. Will this gamble work?
That remains to be seen. However, the history of warfare is replete with
unintended consequences. It is plausible that the aftermath of the Iraq war and
a U.S. occupation of Iraq could increase Al-Qaeda sponsored terrorism against
U.S. targets, or more likely create guerilla warfare in a post-war Iraq.
Moreover, continued U.S. unilateralism could create economic retribution from
the international community or OPEC.

The
question we as Americans must ask -- Can the US military control by force
all oil-producing nations and dictate their oil export transaction currency?
In brief, the answer is no. Will we forfeit any pretense of practicing free-market
capitalism while we enforce a military command economy for global oil
transactions? Is it morally defensible to deploy our brave but naïve young
soldiers around the globe to enforce U.S. dollar hegemony for global oil
transactions via the barrels of their guns? Will we allow imperialist conquest
of the Middle East to feed our excessive oil consumption, while ignoring the
duplicitous overthrowing of a democratically elected government in Latin
America? Is it acceptable for a U.S. President to threaten military force upon
OPEC nation state(s) because of their sovereign choice of currency regarding
their oil exports? I concur with Dr. Peter Dale Scott's sentiments on this
question:

". .
. hopefully decent Americans will protest the notion that it is appropriate to
rain missiles and bombs upon civilians of another country, who have had little
or nothing to do with this (financial) crisis of America's own making."

"A
multilateral approach to these core problems is the only way to proceed. The US
is strong enough to dominate the world militarily. Economically it is in
decline, less and less competitive, and increasingly in debt. The Bush peoples'
intention appears to be to override economic realities with military ones, as
if there were no risk of economic retribution. They should be mindful of
Britain's humiliating retreat from Suez in 1956, a retreat forced on it by the
United States as a condition for propping up the failing British pound. [25]

Lastly,
how can we effectively thwart the threat of international Al Qaeda terrorism if
we alienate so many of our European allies?

Paradoxically,
this administration's flawed economic policies and belligerent foreign policies
may hasten the outcome they hope to prevent -- further OPEC momentum towards
the euro. Furthermore, using U.S. military and/or the threat of force is a
rather unwieldy instrument for Geostrategy, and as such it is unlikely to
indefinitely thwart some OPEC members from acting on their `internal
discussions' regarding a switch to euros. Informed U.S. patriots realize this
administration's failed economic policies in conjunction with their militant
Imperialist overreach is proving not only detrimental to our international
stature, but also threatens our economy and civil liberties. Thus, remaining
silent is not only misguided, but false patriotism. We must not stand silent
and watch our country continue these imperialist policies. The US must not
become an isolated `rogue' superpower, relying on brute force, thereby
motivating other nations to abandon the dollar standard -- and with the mere
stroke of a pen -- slay our superpower status?

This need
not be our fate. When will we demand that our government begin the long and
difficult journey towards energy conservation, development of renewable energy
sources, and sustained balanced budgets to allow real deficit reduction? When
will we repeal the clearly unaffordable 2001 tax cuts to facilitate a balanced
fiscal budget, enforce corporate accounting laws, and substantially reinvest
in our manufacturing and export sectors to gradually but earnestly move our
economy from a trade account deficit position back into a trade account surplus
position?

Indeed,
over the last two decades, the significant loss of U.S. manufacturing
capability to foreign competition has adversely affected our ability to
maintain a sustainable economy. The "New Economy" paradigm of the
1990s has created a false `service sector economy' that simply cannot sustain
the U.S.'s economic and military power status in a competitive globalized
economy. Undoubtedly, we must make these and many more difficult structural
changes to our economy if we are to restore and maintain our international
"safe harbor" investment status.

Furthermore,
it would seem imperative that our government begins discussions with the G7
nations to reform the global monetary system. We must adopt our economy to
accommodate the inevitable ascendance of the euro as an alternative
international reserve currency. I concur with those enlightened economists who
recommend the U.S. begin the process of convening the next `Bretton Woods
Conference.' The U.S. government should compromise and agree to the euro
becoming the next international reserve currency. A compromise on the euro/oil
issues via a multilateral treaty with a gradual phase-in of a dual-OPEC
currency transaction standard seems inevitable. It would also seem prudent to
investigate a third `Asia bloc' of the Yen/Yuan as reserve currency options to
give balance to the global monetary system.

While
these multilateral reforms may lower our excessive oil consumption, force the
US government to engage in fiscally responsible policies, and reduce some of
our global military presence, perhaps these adjustments could also reduce some
of the animosity towards U.S. foreign policies. Secondly, it is hoped such
reforms could improve the quality of our lives, and that of our children by
motivating the U.S. to finally become more energy efficient. Creating balanced
domestic fiscal polices, rebuilding alliances with the E.U./world community and
energy reform are in the long-term national security interests of the U.S.
Global Peak oil is a challenge to humanity itself, and will require an
unprecedented amount of international cooperation and coordination to overcome
this history-making event. Furthermore, global monetary reform is not only
necessary, but could mitigate future armed or economic warfare over oil,
ultimately fostering a more stable, safer, and prosperous global economy in the
21st century.

Unfortunately,
the proposed multilateral conference on monetary reform and energy reform is
viewed as abhorrent to the current neoconservative movement, which is premised
upon the US as the "Pre-eminent" global Empire. [26] Even a cursory reading of the
neoconservative agenda as outlined in the Project for a New American Century
(PNAC) policy document illustrates their idealistic goal is US global dominance
-- both militarily and economically. Indeed, the Bush administration's
entrenched political ideology appears quite incompatible with multilateral
economic reform. The neoconservatives seem to view compromise as antithetical.
Ultimately We the People must demand a new administration. We need responsible
leaders who are willing to return to balanced budgets, conservative fiscal
policies, and to our traditions of engaging in multilateral foreign policies
while seeking broad international cooperation.

Equally
important, we must bear in mind the wisdom of founding fathers like Thomas
Jefferson who insisted that a free press is vital, as it is often the
only mechanism to protect democracy. The American people are not aware of the
issues outlined in this essay because the US mass media has been reduced to
approximately six large media conglomerates that filter 90% of the information
that flows within the U.S. Sadly, part of today's dilemma lays not only within
Congress but also a handful of elitist, imperialist-oriented media
conglomerates that have failed in their Constitutional obligations to inform
the People. Critical information about the Iraq war was only available via the
Internet, which should not be our only source of real, unfiltered news.

Finally,
despite the media reporting otherwise, the current wave of `global
anti-Americanism' is not against the American people or against American
values -- but against the hypocrisy of militant American Imperialism. I
respectfully submit the current polices of the neoconservative movement as
expressed through various PNAC documents, their manipulation of the citizenry
through fear, and the application of unilateral U.S. military force is
treasonous not only to the American Public, but incompatible to the very fundamental
principles that founded our nation.

It has
been said that the vast majority of wars are fought over resources and
economics, and even so-called "religious wars" usually have economics
or access to resources as a hidden motive. The Iraq war is no different from
other modern wars except it appears to usher in `oil currency' as a new
paradigm for warfare. However, the world community may not tolerate an
imperialist U.S. Hyper-Power that ignores International Law while using military
force to conquer sovereign nations. Indeed, the facts suggest additional
oil-producing nation states will eventually exercise their sovereign right by
pricing their oil exports in euros instead of dollars.

I will
reiterate the fundamental issue facing our country -- Can the US military
and intelligence agencies control the governments in all oil-producing nations
-- as well as their oil export currencies? In brief, the answer is no. The
question becomes how many countries will we allow our government to overthrow
under the false pretext of the next "war on terror?" Additionally,
how much international "blowback" against the US and its citizens
would such a Geostrategy create? Likewise, if President Bush pursues an
unprovoked and basically unilateral war against Iraq, the historians will not
be kind to him or his administration. Their agenda is clear to the world
community, but when will US patriots become cognizant of their modus operandi?

"It
is the absolute right of the State to supervise the formation of public
opinion."

"If
you tell a lie big enough and keep repeating it, people will eventually come to
believe it."

"The
lie can be maintained only for such time as the State can shield the people
from the political, economic and/or military consequences of the lie. It thus
becomes vitally important for the State to use all of its powers to repress
dissent, for the truth is the mortal enemy of the lie, and thus by extension,
the truth is the greatest enemy of the State."

-- Dr. Joseph Goebbels, German Minister of
Propaganda, 1933-1945

# # #

Background on Hydrocarbons and US Geostrategy

To
understand US Geostrategy one needs to have a realistic appreciation of the
importance of hydrocarbons, the phenomenon referred to as Peak Oil, and the
importance of Iraq's oil reserves with respect to these issues. I should note
that two types of data exist regarding oil reserves, "political data"
and "technical data." Politicians, the media, and economists use
political data, whereas governments, their intelligence agencies, and geologist
use the much more accurate, and much more guarded, technical data. One
important issue not understood by the general population is the impending
geological phenomenon known as "Peak Oil." It is extremely
unfortunate that our corporate-controlled media conglomerates do not report on
the significance of global Peak Oil. It would seem the European community is
openly discussing this issue, and trying to make preparations to reduce their
overall energy consumption.

Contrarily,
the U.S. government is making preparations for more unilateral wars in an
effort to control the worlds' hydrocarbons -- and the oil currency. [27] The Pentagon has contemplated a
"5-year, 7-war plan." [28] Regarding Peak Oil, Michael
Ruppert's controversial website offers several articles: From the Wilderness. Although some of these
articles are overwrought, their analysis does illustrate how the expanding `war
on terror' follows wherever US Geostrategic concerns are regarding hydrocarbons
reserves or pipelines (West Africa, South America, etc).

This
crucial concept of Peak Oil was first illustrated in bell-shaped curves by U.S.
geophysicist M. King Hubbert, who in 1956 correctly predicted U.S. oil
production would peak in 1971. Each oil field in the world follows a more or
less bell-shaped curve, and the composite view of the world's thousands of oil
fields is one gigantic, ragged edged looking bell-shaped curve. The best source
of data regarding global oil production is form Petroconsultants Inc out of
Zurich. They maintain the largest private databases of the 40,000 oil fields in
the world. It is rumored that the CIA is their biggest client, and that
something in their 1995 report might have predicted global Peak Oil unless the
Caspian Sea region contained an extensive amount of untapped oil. Unfortunately
the reports by Petroconsultants Inc. cost approx. $35,000, and non-disclosure
statements are required for their rather exclusive clientele. Undoubtedly the
Bush/Cheney administration is aware of the issues surrounding Peak Oil. Perhaps
acknowledge of this issue is related to their plans to invade Iraq, which
predate Saddam's switch to the euro by years.

To date
the two most authoritative books I have reviewed regarding technical oil
production data and Peak Oil are the following; The Party's Over: Oil, War
and the Fate of Industrial Societies (2003) by Richard Heinberg [29], and Hubbert's Peak; The
Impeding World Oil Shortage (2001) by Kenneth Deffeyes [30]. Highly respected geologist
Colin Campbell has also researched this issue extensively [31]. Using Hubbert's methodology to
measure global oil production, contemporary geologists have forecast that
global Peak Oil will occur around 2010. Though veteran geologists such as
Kenneth Deffeyes have now concluded that Peak Oil will most likely occur
between 2004 and 2008. The following illustrates his sentiments:

"My
own opinion is that the peak in world oil production may even occur before
2004. What happens if I am wrong? I would be delighted to be proved wrong. It
would mean that we have a few additional years to reduce our consumption of
crude oil. However, it would take a lot of unexpectedly good news to postpone
the peak to 2010. [32]

The
following information will briefly discuss U.S. Geostrategic issues regarding
Iraq's oil reserves. Other than the core driver of the dollar versus euro
currency threat, the other issue related to the upcoming war with Iraq appears
related to some disappointing geological findings regarding the Caspian Sea
region. Since the mid-to-late 1990s the Caspian Sea region of Central Asia was
thought to hold approximately 200 billion barrels of untapped oil (the later
would be comparable to Saudi Arabia's reserve base)." [33] Based on an early feasibility
study by Enron, the easiest and cheapest way to bring this oil to market would
be a pipeline from Kazakhstan, through Afghanistan to the Pakistan border at
Malta. In the late 1990s not only was the Enron Corporation relying on cheap
liquefied natural gas from the Caspian Sea region for their power plan in
India, but also large energy companies such as Unocal and Halliburton.

"I
cannot think of a time when we have had a region emerge as suddenly to become
as strategically significant as the Caspian." -- Former CEO of
Halliburton, Dick Cheney 1998

In fact,
these Caspian region oil reserves were a central component of Vice
President Cheney's energy plan released in May 2001. According to his report,
the U.S. will import 90% of its oil by 2020, and thus tapping into the reserves
in the Caspian Sea region was viewed as a U.S. strategic goal that would help
meet our growing energy demand, and also reduce our dependence on oil from the
Middle East. [34] It is for similar reasons that I
believe Tony Blair endorsed the Iraq war. The U.K. has no oil reserves other
than the North Sea. Unfortunately, the North Sea oil fields belonging to the
U.K. reached peak production in the year 2000.

I suspect
the decline in the North Sea output from 2001 to present day is quite
disconcerting to the British government, as it is much more rapid than one would
expect. Like the U.S., the U.K. will soon import the majority of its oil,
perhaps Blair agreed to the invasion given that British Petroleum (BP) has been
the only non-US oil company that has received oil exploration rights in the
post-Saddam Iraq. Of course the U.K. has not yet ascended to the euro. Because
global oil production seems to have leveled off in 2000, Richard Heinberg
recently suggested that we might have reached a "Peak Oil
Plateau." [35] The following graph illustrates
global Peak Oil.

Once Peak
Oil is reached, the supply of oil/energy will begin an irreversible decline,
along with a corresponding irreversible increase in price despite growing
demand from industrialized and developing nations. Despite various claims by
environmental groups, there is simply no readily available substitute for oil
regarding transportation, nor do the alternatives produce the power output of
oil. Eventually substitutes for oil may become available, but only if we begin
international cooperation on a truly unprecedented scale, and avoid
"global oil warfare."

Although
the records from Vice President Cheney's spring 2001 energy meetings are still
secret, there is one individual who was present during some of those meetings
and is willing to publicly discuss Peak Oil. Mr. Matthew Simmons, who was a key
advisor to the Bush Administration, and participated on Vice President Cheney's
2001 Energy Task Force. Mr. Simmons is an investment banker in Texas, and CEO
of Simmons and Co. International, handling an investment portfolio of $56
billion. In May 2003 Mr. Simmons stated the following at a conference for the
Association of the Study of Peak Oil & Gas (ASPO) in Paris, France.

"I think basically that now, that peaking of oil will never be
accurately predicted until after the fact. But the event will occur, and my
analysis is leaning me more by the month, the worry that peaking is at hand;
not years away. If it turns out I'm wrong, then I'm wrong. But if I'm right,
the unforeseen consequences are devastating. But unfortunately the world has no
Plan B if I'm right. The facts are too serious to ignore. Sadly the
pessimist-optimist debate started too late." [36]

Regarding US Geostrategy in Afghanistan, according to the French book, The
Forbidden Truth,[37] the Bush administration ignored the U.N. sanctions that had been
imposed upon the Taliban and entered into negotiations with the supposedly
`rogue regime' from February 2, 2001 to August 6, 2001. According to this book,
the Taliban were apparently not very cooperative based on the statements of
Pakistan's former ambassador, Mr. Naik. He reports that the U.S. threatened a
`military option' in the summer of 2001 if the Taliban did not acquiesce to our
demands. Fortuitous for Cheney's energy plan, Bin Laden delivered to us
9/11/01. The pre-positioned U.S. military, along with the CIA providing cash to
the Northern Alliance leaders, led the invasion of Afghanistan and the Taliban
were routed. The pro-western Karzai government was ushered in. The pipeline
project was now back on track in early 2002, well, sort of . . .

After three exploratory wells were built and analyzed, it was reported
that the Caspian region holds only approximately 10 to 20 billion barrels of
oil (although it does have a lot of natural gas)." [38] The oil is also of poor quality, with high sulfur content.
Subsequently, several major companies have now dropped their plans for the
pipeline citing the massive project was no longer profitable. Unfortunately,
this recent realization about the Caspian Sea region has serious implications
for the U.S., India, China, Asia and Europe, as the amount of available
hydrocarbons for industrialized and developing nations has been decreased
downward by 20%. (Remaining global estimates reduced from 1.2 trillion barrels
to approx. 1.0 trillion) [39][40].

The
following graph illustrates Global Peak Oil, sometimes referred to as the
"Big Rollover."

It is
widely reported as factual that Iraq has 11% of the world's total oil reserves
(112 billion barrels). However, no geological surveys have been conducted in
Iraq since the 1970s. The Russians, French, and Chinese were eager to lease
Iraq's unexplored fields, which may contain up to 200 billion barrels [39]. In January 2002 President Bush asked General Tommy Franks to construct
an invasion plan for Iraq. Under the threat of "mushroom clouds," our
prime nemesis, Bin Laden, was skillfully replaced by the OSP into our new
public enemy #1, Saddam Hussein.

For those who would like to review how depleting hydrocarbon reserves
could adversely erode our civil liberties and democratic processes, retired
U.S. Special Forces officer Stan Goff offers a sobering analysis in his essay:
"The Infinite War and Its Roots". [41] Likewise, for those who wish to review some of the unspeakable evidence
surrounding the September 11th tragedy, Gore Vidal's controversial book, Dreaming
War offers a thorough introduction. [42] Finally, The War on Freedom: How and Why America was Attacked,
September 11, 2001 by British political scientist Nafeez Mosaddeq Ahmed methodically presents disconcerting questions about the 9/11 tragedy
and U.S. geostrategy regarding Afghanistan. [43]

20."The Choice
of Currency for the Denomination of the Oil Bill,"
Speech given by Javad Yarjani, Head of OPEC's Petroleum Market Analysis Dept,
on The International Role of the Euro (Invited by the Spanish Minister of
Economic Affairs during Spain's Presidency of the EU), April 14, 2002, Oviedo,
Spain

33.Pfeiffer,
Dale Allen, "Much Ado
about Nothing -- Whither the Caspian
Riches? Over the Last 24 Months Hoped For Caspian Oil Bonanza Has Vanished With
Each New Well Drilled -- Global Implications Are Frightening," From The
Wilderness, December 5, 2002

38.Ruppert,
Michael, "The Unseen
Conflict -- War Plans, Backroom Deals, Leverage and
Strategy -- Securing What's Left of the Planet's Oil Is and Has Always Been the
Bottom Line," From The Wilderness, October 18, 2002

39.Ruppert,
Michael, FTW Interview: "Colin Campbell on Oil -- Perhaps
the World's Foremost Expert on Oil and the Oil Business Confirms the Ever More
Apparent Reality of the Post-9-11 World," From The Wilderness,
October 23, 2002

After
completing this essay in mid-January 2003, I began to read about some
interesting international monetary developments and the related opinions of
analysts. These recent developments warrant inclusion as an addendum. The
following two articles relate to the rapid devaluation of the dollar in late
January relative to the euro. This occurred in the week immediately preceding
President Bush's State of the Union address. Both of these articles suggest that
Russia -- a traditional holder of dollar reserves -- may be linking `political
overtones' to their exchanges of dollars for euros. The following article may
illustrate things to come if President Bush continues on his present unilateral
position on Iraq.

"The
dollar remained on the ropes on Thursday, buffeted by some hawkish remarks from
the US administration about the standoff with Iraq. It was also stung by a
pointed signal from Russia's central bank that the appeal of dollar-denominated
assets is waning.

"Oleg
Vyugin, first deputy chairman at the Russian central bank, said the bank plans
to cut the share of US dollars in its foreign exchange reserves and increase
the share of other currencies. . . .

"Some
analysts questioned whether there may be political overtones to Vyugin's
remarks, that could be related to the widening rift between the US and some
other potential allies about how to persuade Iraq to comply with UN weapons'
inspectors requirements.

"Although
Russia's own foreign exchange reserves are fairly small by comparison with the
world's biggest central banks, the question is, `Will other central banks
follow and what does this do to the ability of the US to finance its current
account deficit?' said Marc Chandler, chief currency strategist with HSBC in
New York.

"That
deficit is currently around 5% of gross domestic product and proving to be an
increasingly heavy millstone around the dollar's neck." [44]

Although
global currency exchanges are notoriously volatile, it is interesting to note
the following day (January 25th) some analysts reiterated that these monetary
movements may be related not only to the current geo-political tensions, but
may also indicate political motivations. Is this perhaps a `warning shot over
the bow' for the Bush administration regarding their position on Iraq? These
monetary movements by various central banks illustrate trouble for the dollar.

"All
of a sudden, the dollar's supposedly slow and gradual decline isn't looking so
slow, or gradual.

"In
fact the speed of the dollar's slide, against the euro in particular, has taken
even the most seasoned analysts by surprise: a Dow Jones Newswires foreign
exchange survey just ten days ago showed the major currency trading banks
forecasting the euro climbing to $1.06 by the middle of February and not coming
near $1.10 until the end of the year.

"Instead,
the euro has leaped to highs of around $1.0850 on Friday and has already gained
4% on the dollar this year, leaving strategists increasingly scrambling to
update their forecasts. The Swiss franc keeps reaching fresh four-year highs,
and the dollar is on the ropes against sterling and a host of other key rivals.

"Perhaps
a more important barometer of broader confidence in U.S. markets is the
Treasurys market. With the dollar falling, gold spiking and stocks under
pressure, Treasurys continue to retain their safe haven appeal.

"But
there are warning signals here, too, that are beginning to get more attention.
This week, the Russian central bank said it was lowering the U.S. asset portion
of its foreign exchange reserves -- in other words selling Treasurys -- calling
the dollar a low-yielding currency.

"Analysts
believe some of the large Asian central banks -- that between them hold the
lion's share of the world's dollar reserves -- are also considering rejigging
their Treasury holdings. A U.S.-led war in Iraq could further accelerate that
trend.

"Indeed,
some political analysts believe that U.S. policy over Iraq may already be
having a direct impact on holdings of U.S. assets, particularly with much of
the rest of the world so opposed to war. `It's hard for me to believe that the
flow of capital cannot help but be affected by how the U.S. is perceived around
the world,' said Larry Greenberg, an international economist at Ried Thunberg
& Co. in Westport, Conn.

"`Today
if you have the U.S. acting (in Iraq) against world opinion, there could be an
even faster pullback out of dollar-denominated assets,' said Joseph Quinlan,
global economist with Johns Hopkins University, in Washington. `How we go to
war influences the rate of decline of the dollar' he said." [45]

The day
after the above article, the UK Observer's Will Hutton wrote a forceful article
against Bush's unilaterism. This article further emphasizes the unfortunate
economic imbalances of the U.S. economy, and suggests the potential
geo-political fallout of a unilaterist war or an unstable aftermath in Iraq
could create a significant divestiture of dollar denominated assets.

"The
US's economic position is far too vulnerable to allow it to go war without
cast-iron multilateral support that could underpin it economically as well as
diplomatically and militarily. The multi-lateralism Bush scorns is, in truth,
an economic necessity. . . .

"On
latest estimates, its net liabilities to the rest the world are more than $2.7
trillion, nearly 30 per cent of GDP, a scale of indebtedness associated with
basket-case economies in Latin America.

"Its
industrial base is so uncompetitive that it consistently imports more than it
exports; its current-account deficit, the gap between all its current foreign
earnings and foreign spending, is now a stunning 5 per cent of GDP, continuing
a trend that has lasted for more than 25 years and which is the cause of all
that foreign debt. As a national community, it has virtually ceased to save so
that government and individuals alike live on credit.

To
finance the current-account deficit, a reflection of the lack of saving, the US
relies on foreigners supplying it with the foreign currency it can't earn
itself. . . .

"But
if foreigners got windy about the prospects for share and property prices and
stopped buying, or began to withdraw some of the trillions they have invested
in the US economy, then the dollar would collapse. Already, it has fallen
nearly 10 per cent against the euro over the last six weeks, but that could
just be the beginning. Economists at the Federal Reserve have estimated that
the dollar needs to fall by 30 per cent to bring the flow of imports and
exports into balance, but in today's markets such a fall doesn't happen
gradually. It happens precipitately.

"If
America and Britain spurn a second UN Resolution and go to war with the active
opposition of key members of the Security Council like France and Russia, be
sure the flow of dollars into the US will slow down dramatically, and be sure
there will be a stampede of foreigners trying to sell. Shares on Wall Street
that Bush is so anxious to prop up are still massively overvalued. Against this
background, there could be a devastating sell-off, with all the depressing
knock-on consequences for American consumer confidence and business investment.

"What
the markets were signaling last week was that this is sufficiently within the
bounds of possibility that it was worth taking precautionary action, hence the
selling. If the war was over in a few weeks, the risks would be containable,
and there will be some shares well worth buying at today's prices. But if the
war was prolonged or the subsequent peace unstable, then the pressure on the
dollar and Wall Street could become very severe indeed, reinforcing the
depressive influences on an economy where the underlying imbalances are so
extraordinary.

"The
US approach has been unilateralist here as everywhere else: it does what it
likes as it likes, a policy that is now showing its limits. Bush needs badly to
change course, which Tony Blair should be urging on him. The UN process needs
to be respected and reinforced, not least to reassure the markets, and better
systems of economic governance need to be put in place. The US's military
capacity may allow unilateralism; its soft economic underbelly, we are
discovering, does not." [46]

These
articles indicate that many central banks are reducing their reliance on
dollars, and quite possibly sending a message about their opposition to the
U.S.'s position on Iraq. Mr. Hutton is correct; our current economic structure
simply cannot afford a significant divesture of foreign investments, nor can
the indebted US consumer and corporate sectors absorb such disruptions.
Although these currency movements are typically described as purely
economically derived decisions, it would be naïve to suggest that geopolitics
and global tensions have not played a role in the broad movement away from the
dollar. The world has no interest in challenging the US militarily, but given
our debt levels, we have become quite vulnerable from an economic perspective.
. Hence, it is inadvisable for President Bush to pursue an aggressive,
unilateral application of U.S. military force without broad U.N./international
support.

European Commentary on the Essay:
`The Real Reasons for the Upcoming War With Iraq'

To
finish, in January 2003, Mr. Coílín Nunan reviewed a draft of my essay on an
Internet forum. He subsequently published an exceptional summary on an Irish
website (www.feasta.org). Hopefully our
efforts will facilitate public awareness, and stimulate a more honest debate on
the Iraq issues. Below are excerpts from his informative article "Oil,
Currency, and the War on Iraq."

"One
of the stated economic objectives, and perhaps the primary objective, when
setting up the euro was to turn it into a reserve currency to challenge the
dollar so that Europe too could get something for nothing.

"This
however would be a disaster for the US. Not only would they lose a large part
of their annual subsidy of effectively free goods and services, but countries
switching to euro reserves from dollar reserves would bring down the value of
the US currency. Imports would start to cost Americans a lot more and as
increasing numbers of those holding dollars began to spend them, the US would
have to start paying its debts by supplying in goods and services to foreign
countries, thus reducing American living standards. As countries and businesses
converted their dollar assets into euro assets, the US property and stock
market bubbles would, without doubt, burst. The Federal Reserve would no longer
be able to print more money to reflate the bubble, as it is currently openly
considering doing, because, without lots of eager foreigners prepared to mop
them up, a serious inflation would result which, in turn, would make foreigners
even more reluctant to hold the US currency and thus heighten the crisis.

"There
is though one major obstacle to this happening: oil. Oil is not just by far the
most important commodity traded internationally, it is the lifeblood of all
modern industrialised economies. If you don't have oil, you have to buy it. And
if you want to buy oil on the international markets, you usually have to have
dollars. Until recently all OPEC countries agreed to sell their oil for dollars
only. So long as this remained the case, the euro was unlikely to become the
major reserve currency: there is not a lot of point in stockpiling euros if
every time you need to buy oil you have to change them into dollars. This
arrangement also meant that the US effectively part-controlled the entire world
oil market: you could only buy oil if you had dollars, and only one country had
the right to print dollars -- the US.

"If
on the other hand OPEC were to decide to accept euros only for its oil
(assuming for a moment it were allowed to make this decision), then American
economic dominance would be over. Not only would Europe not need as many
dollars anymore, but Japan which imports over 80% of its oil from the Middle
East would think it wise to convert a large portion of its dollar assets to
euro assets (Japan is the major subsidizer of the US because it holds so many
dollar investments). The US on the other hand, being the world's largest oil
importer would have, to run a trade surplus to acquire euros. The conversion
from trade deficit to trade surplus would have to be achieved at a time when
its property and stock market prices were collapsing and its domestic supplies
of oil and gas were contracting. It would be a very painful conversion.

"The
purely economic arguments for OPEC converting to the euro, at least for a
while, seem very strong. The Euro-zone does not run a huge trade deficit nor is
it heavily indebted to the rest of the world like the US and interest rates in
the Euro-zone are also significantly higher. The Euro-zone has a larger share
of world trade than the US and is the Middle East's main trading partner. And
nearly everything you can buy for dollars you can also buy for euros -- apart,
of course, from oil . . .

"All
of this is bad news for the US economy and the dollar. The fear for Washington
will be that not only will the future price of oil not be right, but the
currency might not be right either. Which perhaps helps explain why the US is
increasingly turning to its second major tool for dominating world affairs:
military force." [47]

Saving the American Experiment (March 10, 2003)

Considering
the core economic challenges that our nation faces, and the deplorable oil
currency war that I fear we are about to witness in Iraq, this author advocates
that the global monetary system be reformed without delay. This would include
the dollar and euro designated as equal international reserve currencies, and
placed within an exchange band along with a dual-OPEC oil transaction currency
standard. Additionally, the G7 nations should also explore a third reserve
currency option regarding a yen/yuan bloc for Asia. Such reforms may lower our
ability to fund massive deficits, consume excessive oil/energy, and project a
global military force, but they could improve the quality of our lives and that
of our children by reducing animosity towards the U.S. and force our government
to pursue more fiscally responsible polices.

Given
that 95% of the world's transportation system is dependent on depleting
hydrocarbons, the urgency in which we must pursue new and alternative methods
of energy production cannot be overstated. Indeed, it is plausible that if the
US government effectively advocates energy reform regarding our own consumption
levels, we as a nation could simultaneously pursue the crucial patriotic goal
of enhancing the security of our nation by becoming one of the world's leaders
in developing and implementing alternative energy sources. This is the missed
opportunity that real US leadership could have provided in the aftermath of 9/11.
We could have received an inspiring call to duty, challenging our nation to
"go to the moon" by the end of this decade regarding energy policy,
but instead the message was: "Unite. Go shopping, and don't be afraid to
fly." Failing to rally the citizenry for truly patriotic purposes to
strengthen our nation was perhaps one of the greatest missed opportunities
since the end of the Cold War.

We need a
real National Energy Policy instead of an "endless war on terrorism."
Today's "blowback" is partly due to our ongoing support of corrupt
Middle East regimes/dictatorships. [48] Creating a more equitable global
monetary system while maintaining a strong transatlantic relationship with
Europe is in the long-term national security interest of the U.S. Hopefully
monetary and energy reform could mitigate future armed or economic warfare over
oil, thus ultimately fostering a more stable, safer, and prosperous 21st
century.

Tragically,
President Bush's administration does not appear willing to initiate the arduous
structural changes that our economy must undertake if we are to adapt and
accommodate the euro as the second World reserve currency. Furthermore, this
administration has not communicated to the People the urgent need for energy
reform. Instead, they intend to enforce global dollar monopoly for oil
transactions via the application of superior U.S. military force. My essay was
written out of patriotic duty in an effort to illustrate that such a
military-centric geostrategy for Empire has produced international isolation of
the U.S., and may ultimately result in our economic failure. I firmly believe
our nation will be better prepared to meet this decade's challenges if the
citizenry is cognizant of why the worldview is coalescing against the U.S., why
our nation is attempting by force to secure Iraq's oil, revert its oil currency
back to the dollar, and install a permanent US military presence in the Persian
Gulf region. We must not allow the militant imperialism of this administration
to bring down the American Experiment.

"Of
all the enemies to public liberty war is, perhaps, the most to be dreaded
because it comprises and develops the germ of every other . . . No nation could
preserve its freedom in the midst of continual warfare."

48.Johnson,
Chalmers, Blowback; The Cost and Consequences of American Empire, Owl
Books (2003)

Post-War Commentary (January 1, 2004)

"Hussein
has not developed any significant capability with respect to weapons of mass
destruction. He is unable to project conventional power against his
neighbors."

--Colin Powell on February 24, 2001

"Our conservative estimate is that Iraq today has a stockpile of between
100 and 500 tons of chemical weapons agent. That is enough agent to fill 16,000
battlefield rockets. Even the low end of 100 tons of agent would enable Saddam
Hussein to cause mass casualties across more than 100 square miles of
territory, an area nearly five times the size of Manhattan."

--Colin Powell at the UN on February 5, 2003

"Simply stated, there is no doubt that Saddam Hussein now has weapons of
mass destruction,"

--Dick Cheney on August 26, 2002.

"Intelligence leaves no doubt that Iraq continues to possess and conceal
lethal weapons."

--George W. Bush on March 18, 2003

"We are asked to accept Saddam decided to destroy those weapons. I say
that such a claim is palpably absurd."

--Tony Blair on March 18, 2003

"Why of course the people don't want war. . . . That is understood. But,
after all, it is the leaders of the country who determine the policy, and it's
always a simple matter to drag the people along whether it's a democracy, a
fascist dictatorship, a parliament or a communist dictatorship . . . the people
can always be brought to the bidding of the leaders. . . . All you have to do
is tell them they are being attacked, and denounce the pacifists for lack of
patriotism, and exposing the country to greater danger.

From the
Roman Empire to today, the propaganda tactics for war as discussed by Hermann
Goering remain effective. It is deplorable that even in the US or UK, people
can always be "brought to the bidding of the leaders." It is New
Years Day, almost nine months since the invasion of Iraq. The American people
are slowly realizing how much they were misled about this war. Many books will
be written about how these events unfolded, so I will only briefly summarize my
general observations in a few opening paragraphs, and then return to the basic
underlying Geostrategic and macroeconomic reasons for the Iraq war. First, it
has emerged that a small clique of neoconservative ideologues and an Iraqi
exile provided most of the fraudulent "intelligence data" that was
publicized by the Executive Branch. This disinformation was apparent before the
war, but now it is simply irrefutable. A brief synopsis of events follows.

Apparently
in 2001-2002 the DIA and CIA were not giving Secretary of Defense Donald Rumsfeld
intelligence information that would justify a US invasion of Iraq. In fact, it
was well known to our intelligence agencies that Iraq's WMD was dormant, and as
early as 1998 it was understood that Saddam had no ties to Al Qaeda. [49] To date,
no professionals in the CIA, DIA, MI5 or MI6 have provided reliable evidence
linking Saddam Hussein to bin Laden, Al Qaeda or to the September 11th
attacks. [50]
Undeterred, Donald Rumsfeld set up his own secretive and rather autonomous
unnamed intelligence unit referred to simply as the "cell." This
small group later merged into his other small "intelligence unit"
called the Office of Special Plans (OSP).

The purpose of these "intelligence units"
was to bypass the CIA and DIA, and to provide "faith-based
intelligence" to Vice President Cheney and President Bush. The OSP's sole
purpose was to promote the Iraq war. This group self-mockingly referred to
themselves the "cabal". [51] The
following is a slightly modified chart from the February 2004 edition of Mother
Jones. [52]

It is now obvious the main rationales for the Iraq
war were developed by a rather unprecedented government conspiracy perpetrated
by a small number of radical neoconservatives in the OSP, plus Iraqi exiles in
the INC. In essence, the justification for invading of Iraq was a coordinated
and transparent pack of fabrications and deceptions -- designed to create the
requisite societal fear for an invasion. I suspect the OSP "cabal"
will go down in history as the `Office of Special Propaganda.' It is
disconcerting that 19 men were able to instill massive levels of irrational
fear into the citizenry by creating visions of "mushroom clouds" and
"1000 metric tons" of Anthrax.

Of course our elitist, corporate-controlled media
dutifully repeated all this propaganda verbatim. Indeed, the 2002-2003
propaganda campaign by the OSP and the Bush administration was designed to
portray an "imminent threat" to U.S. national security -- regardless
of the facts. According to former intelligence professionals, members of the
OSP are dangerous ideologues. The following is a review of the findings
regarding the search for WMD, as of October 2003: [53]

Claims about Iraqi WMD vs.

Actual Facts

Precursor Chemicals: 3,307 tons

Found: None

Tabun, nerve agent

Found: None

Mustard agent

Found: None

Sarin, nerve agent

Found: None

VX nerve agent, 1.6 tons

Found: None

Anthrax spores raw material: 25,550 liters

Found: None

Botulinnum toxin

Found: One vial of Sarin B, 10 years old, in an
Iraqi scientist's domestic refrigerator

Alfotoxins

Found: None

Ricin

Found: None

Mobile bio-weapons laboratories: possibly 18

Found: Two suspected mobile labs found to be
harmless, possibly purchased from the UK in 1987 as atmospheric hydrogen
balloon labs for artillery aiming purposes

With their mission accomplished, Donald Rumsfeld
disbanded the OSP in September 2003. Despite the so-called Congressional
investigation into "intelligence failures" regarding Iraq, there is
"strong resistance" by the Republicans to investigate the OSP and
related activities. It is highly doubtful Congress will expose the truth in the
near future, as it would make Richard Nixon's "dirty tricks" and the
Watergate scandal simply pale in comparison. Indeed, if Thomas Jefferson, James
Madison, or George Washington were alive today, they would probably demand
these nineteen men be immediately charged with high crimes and treason.

As I noted a year ago, it would seem more likely
that Al Qaeda will search within the former states of the Soviet Union for a source
of WMD. Initially, the Bush administration froze funding for the Russian
non-proliferation WMD destruction program, but now have unfrozen funding. [49]

According
to retired 27-year veteran of the CIA, Ray McGovern, there is an
"incredible amount of unease and disarray" between the
neoconservatives and US intelligence professionals. [54] Aside from the Iraq debacle, the
CIA may be distraught at the apparently politically motivated
"outing" of Valerie Plume, a covert CIA agent whose expertise was in
the field of reducing the proliferation of the WMD. Such irresponsible
behavior, possibly emanating from the Executive branch of our government,
needlessly jeopardizes the national security of the U.S.

Regarding
the post-war situation in Iraq, it appears to be an unfortunate and
deteriorating situation. Despite the ongoing resistance in the form of guerilla
warfare and almost daily deaths of U.S. soldiers, this administration is moving
forward with their Geostrategic goals. On May 9th, 2003 the Bush administration
presented U.N. Security Council Resolution 1483, proposing to drop all
sanctions against Iraq, and allow the U.S./U.K. to completely control Iraq's
oil production revenue. Due to US pressure, this UN resolution was passed on
May 22, 2003. However, according to the original UN resolutions from 1990, the
sanctions could not to be lifted until the U.N. certifies Iraq as being
free of WMD. Interestingly, the Bush administration blocked Dr. Blix and all of
the U.N. inspectors from returning to Iraq in the "post-war" period,
and successfully had the UN sanctions lifted regardless of Iraq's WMD status.
Why? Empire.

Neoconservative
Geostrategy is based upon the idea of a US "Global Empire" and
therefore it could not be tolerated for any nations, be it France, Russia or
China to gain control over 40 billion barrels of Iraqi oil, or for that oil be
sold in the euro currency. (This assumes Iraq reserves are in fact 112 billion
barrels, of which those three nations would have gained legal exploration
access to 35% of Iraq's total reserves -- but only if Iraq was declared by the
UN to be free to WMD). The European media has noted that had Dr. Blix and the
U.N. inspectors been allowed to complete their `pre-war' inspection process for
an estimated 6 more months in 2003, they could have ultimately determined Iraq
was indeed free of WMD.

In that
scenario, the lease contracts and oil exploration rights that the Russians,
French and Chinese held regarding Iraq's oil fields could have been legally
initiated. Indeed, lifting the UN sanctions would have allowed foreign
investment to begin rebuilding and exporting Iraqi's vast reserves, while
simultaneously impeding the ability of major US/UK oil companies to gain access
to Iraqi oil given Saddam's dislike of the US/UK post-1991 foreign policies
towards Iraq.

Returning
to the core macroeconomic reasons for the Iraq war, it should be noted that
under the UN's `oil for food' program, the U.N. provided oversight of Iraq's
oil receipts, which in 2000 became denominated in euros, and then deposited
into a French bank. The passage of UN resolution 1483 effectively ended French involvement
with Iraqi oil via the UN `oil for food' program. Incidentally, the various
contracts that Saddam Hussein signed during the 1990's regarding oil
exploration leases with France, Russia and China are now also void. Without a
doubt, oil is the critical substance for all industrialized nations, and with
the imminent global Peak Oil phenomenon, the U.S. government is using the
military to insure U.S. access to the largest reserves. The price of the Iraq
war is not yet clear, but the history of Empires is quite unambiguous. They
always end with military overextension and subsequent economic decline.

On April
28, 2003, I read the first article in the mainstream US media (msnbc.com)
since the autumn of 2000 that addressed some of the issues regarding Iraqi oil
exports in the euro. Apparently until the U.N. sanctions were lifted; Iraq's
oil was to remain under UN control in the "oil for food" program.
However, UN Resolution 1483 passed on May 22, 2003 establishing a joint US/UK
administered "Iraqi Assistance Fund" which provided the mechanism to
quietly and legally reconvert Iraqi's oil exports back to the dollar. To
reiterate, the following excerpts from this forthright msnbc.com article
is the only mainstream US media reference that I could locate during 2003
that discussed the Iraq war and the underlying petrodollar versus petroeuro
issues. It was entitled "In Round 2, It's the Dollar versus the Euro"
(implying the Iraq war was `Round 1').

A new
world is being created. Ironically, the most troublesome clash of civilizations
in it may not be the one the academics expected: not Islamic fundamentalists
vs. the West in the first instance, but the United States against Europe.

To
oversimplify, but only slightly, it's the dollar vs. the euro.

. . . The
Europeans and the United Nations want the inspections regime to resume because
as long as it is in place, the U.N. "oil-for-food" program remains in
effect. Not only does France benefit directly-its banks hold the deposits and
its companies have been involved in the oil sales-the entire EU does as well,
if for no other reason than many of the recent sales were counted not in
dollars but in euros. The United Nations benefits because it has collected more
than a billion dollars in fees for administering the program. As long as the
1990 sanctions remain in effect, Iraq can't "legally" sell its oil on
the world market. At least, to this point, tankers won't load it without U.N.
permission, because they can't get insurance for doing so.

Sometime
in the next few weeks, push will come to shove. There are storage tanks full of
Iraqi crude waiting in Turkish ports. For now, Rumsfeld and Powell are playing
"bad cop, bad cop." "This isn't on the president's radar screen
right now," an aide told me. "Powell is totally on board, though. He
is as angry at the French as anyone else, maybe more. There may come a time
when the smart thing to do is turn the whole Iraq situation over to the U.N.
This is not that time." Meanwhile, if the rest of the world tries to block
any and all Iraq oil sales, it's possible that American companies will find a
way to become the customer of first and last resort.

Although
the author addressed this subject somewhat obliquely, his final sentence is
quite candid. Indeed, my original hypothesis from December 2002 was reinforced
in a Financial Times article dated June 5th 2003 which confirmed Iraqi
oil sales returning to the international markets were once again denominated in
U.S. dollars, not euros. Not surprisingly, this detail was never mentioned in
our imperialist, corporate-controlled US media, but confirmation of this fact
provides insight into one of the crucial -- yet overlooked -- rationales for
the Iraq war.

"The
tender, for which bids are due by June 10, switches the transaction back to
dollars -- the international currency of oil sales -- despite the greenback's
recent fall in value. Saddam Hussein in 2000 insisted Iraq's oil be sold for
euros, a political move, but one that improved Iraq's recent earnings thanks to
the rise in the value of the euro against the dollar." [56]

Additionally,
one notable post-war realization is the dollar's new role in Iraq. In April
2003 it was reported that US dollars are being flown into Iraq in order to pay
the Iraq civil servants $20 per week as a "temporary" measure. [57] Ironically, some Iraqis were
returning to a newly appreciating Iraq Dinar or supposedly dead "Saddam
Dinar" -- instead of U.S. dollars. [58]

Given the
lack of WMD in Iraq, the lack of evidence tying Saddam to the September 11th
attacks, and the lack of any proof that Saddam had worked with the Al Qaeda
terrorist organization, the Bush administration is trying to switch the
rational of the Iraq war to "spreading democracy." Again, the facts
on the ground do not support this assertion. In June 2003 Paul Bremer
unilaterally canceled the request from the Iraqis to hold local
elections. [59] Not surprisingly, this
administration has also discussed disbanding the Coalition Provisional
Authority (CPA). In the harsh reality of oil and geostrategy, the US probably
does not want a real democracy in Iraq for the same reasons that the CIA and
British overthrew Iran's fledgling democracy in 1953. In order to understand
why the U.S. does not promote democracies in the oil producing states of the
Persian Gulf, I recommend that others read All the Shah's Men by Stephen
Kinzer. [60] There
are lessons to learn from what happened in Iran fifty years ago.

At the time, Prime Minister Mohammed Mossadegh, a
nationalist and anti-communist, and requested that the British allow Iran to audit
the oil proceeds from Iran's oil exports. He felt Iran was not getting
sufficient financial returns on their vital resources. The British resisted,
and Mossadegh made a decision that was beneficial to Iran, but not the British.
After the British refused to share with Iran more of the profits over its oil
export, Dr. Mossadegh made the unfortunate mistake of nationalizing Iran's oil
in 1951. At the time the Anglo-Iranian oil company (later to become BP) was
reaping 88% of the profits from Iran's oil exports. [61] Prime
Minister Mossadegh then offered the British 25% of the profits after he
nationalized Iran's oil. The British responded by blockading Iran and freezing
Iran's assets. Furthermore, the British claimed that nationalization of Iran's
oil was illegal. This was a dubious claim over Iran's sovereignty, so Dr.
Mossadegh argued his case in front of the United Nations and won. Undeterred,
Winston Churchill asked President Truman to help overthrow Mossadegh, but
Truman declined.

However, in 1953 incoming President Eisenhower did
agree to the coup, and the CIA successfully overthrew Prime Minister Mossadegh
in August 1953. The US/UK then installed Mohammed Shah, who later became
despised as a US-puppet, and whose brutal SAVAK secret police force ultimately
radicalized Iranian society. This "blowback" resulted in the Iranian
Revolution of 1979. It is interesting to note that current Islamic mullahs in
Iran do not speak with reverence about Dr. Mossadegh (who was a secular
leader), but apparently the Iranian people fondly remember his secular
government. Below is an excerpt from All the Shah's Men.

"Why did you Americans do that terrible
thing?" a relative of Mossadegh demands of Kinzer. "We always loved
America. To us, America was the great country, the perfect country, the country
that helped us while other countries were exploiting us. But after that moment,
no one in Iran ever trusted the United States again. I can tell you for sure
that if you had not done that thing, you would never have had that problem of
hostages being taken in your embassy in Tehran. All your trouble started in
1953. Why, why did you do it?" [60]

As
evidenced by Stephen Kinzer's interviews with various Iranians, it is clear the
Iranian people were quite pro-US before we intervened and overthrew their
democracy. Regrettably, many Iranians have not forgiven us for what we did to
them 50 years ago. Ironically, Iran still appears to be the best candidate for
a large Middle Eastern democracy. Perhaps if our government leaves Iran alone,
and in conjunction with a peaceful resolution to the Israeli-Palestinian conflict,
the Iranian people might eventually revise their Constitution. Reforming their
government to reflect a more democratic and secular nation is plausible given
the large and youthful Iranian population who embraces a more open society. In
the meantime, we should attempt to build confidence by providing diplomatic
engagement, and assistance as needed, such as offering humanitarian aid in the
aftermath of the earthquake that struck Iran in December 2003.

Undoubtedly,
President Bush's declaration that Iran is an "Axis of Evil" has
damaged the US-Iran relationship, and thus has allowed the E.U. to establish
enhanced trade relationships with Iran. It is obvious that any U.S. military or
covert action against Iran would be completely unilateral, and even the U.K.
has warned that "regime change" in Iran is not a plausible option. In
fact, threatening Iran is only creating more "blowback" against the
United States. As for Iraq, the "blowback"/resistance is continuing
despite Saddam's capture, making the "installment" of democracy even
more unrealistic. I suspect a real democracy in Iraq would most likely
nationalize Iraq's oil industry in an effort to keep the critical oil profits
within the country, thereby greatly facilitating the rapid rebuilding of Iraq
society (infrastructure, healthcare, education, etc.)

Obviously
re-nationalizing Iraq's oil industry is not something the Bush administration
and its major campaign contributors are interested in pursuing. The Iraq war
was over power, and UN Resolution 1483 insured U.S./U.K. control over Iraq's
oil revenue, contrary to reports that the Iraqi people wanted the United
Nations to retain control of Iraqi's oil resources. Despite its faults, the UN
simply has more credibility in the eyes of the world community than Paul
Bremer, and that includes the Iraqi citizenry as well. On the contrary, the
Bush administration's major paymasters -- the military-oil-industrial
conglomerates -- expect and are receiving hundreds of billions of our tax
dollars. (ie. no-bid contracts for Halliburton and Bechtel corporations, etc).

However,
there are also macroeconomic reasons why I doubt we will see democratic rule in
Iraq -- the petrodollar versus petroeuro oil currency issue. As of December 30,
2003 the euro was worth 25% more than the dollar (1.25 to $1.00). Given the EU's
upcoming enlargement plans for 2004, and the fact that following this
enlargement 60% of OPEC oil will be imported by the EU, from a purely economic
perspective it makes sense for Iraq to do what Iran has recently done --
require payment for oil in euros, not dollars. Of course the emergence of a
`petroeuro' is one of the crucial reasons why we overthrew Saddam in the first
place. Therein lies the paradox for the United States -- In a true democracy
the leader of Iraq would be expected to do what is in the best interest for the
majority of Iraqi citizens, regardless of whether they are Shi'ite, Sunni or
Kurdish. At this time it would be logical to re-nationalize Iraq's oil industry
(which the Bush administration privatized after the invasion -- but only for
the "major" US and UK oil companies).

Further,
it would be economically advantageous to denominate oil sales in the currency
that would provide Iraq with the most purchasing power and trade potential in
which to rebuild the country -- which given current valuations now and into the
foreseeable future implies the euro. Self-determination and democratic rule
does not always fit U.S. "hegemonic interests." Much of the current
"anti-Americanism" in the Middle East is based on the hypocrisy of
our foreign policies -- we say we stand for democracy, yet we have a long
history of propping up "stable" but brutal and oppressive regimes.
Examples include Iran 1953-1979, Iraq 1963-1990, Saudi Arabia 1944-present, and
our overtly biased policies regarding the Israel-Palestinian conflict.

Below are
excerpts from an article on www.prudent
bear.com. While this author acknowledges the issues regarding Iraq and the
dollar/euro oil conflict, he suggests that reporting the truth is "freedom
of screech" (in Washington DC the truth has been reduced to
"political hate speech.")

At
present, we notice that many US citizens are exercising their "freedom of
screech" to politicize the fact that the current President miss-stated the
case for immediate war with Iraq. Perhaps the President should be praised for
"doing what was right" for America's interests, even though the
Administration could be faulted for the "way it was done". I, for
one, would not want to bring back an Arab oil embargo and long lines at the gas
pump. [62]

The idea that re-denominating oil exports in a
different currency is the same as an "Arab oil embargo" is an
interesting display of flawed logic, especially from a website that promotes
increased market transparency, fiscal discipline, and is rightfully
pre-occupied with the Fed's expansion of the US money supply. Despite these
flaws, the author acknowledge the key issue:

. . . the one factor underpinning American
prosperity is keeping the dollar the World Reserve Currency. This can only be
done if the oil producing states keep oil priced in dollars, and all their
currency reserves in dollar assets. If anything put the final nail in Saddam Hussein's
coffin, it was his move to start selling oil for Euros.

The US is the sole super power and we control and
dictate to the Middle East oil producers. America has the power to change
rulers if they can't follow the "straight line" the US dictates.
America's prosperity depends on this.

Governments have secrets. If politicians always
told the truth, there wouldn't be any secrets. So, if governments are to keep
secrets, how can you fault a politician for not telling the whole truth? We
would assert that the President failed to present the real case for Iraq, which
is: 1) prosperity for America based on controlling Middle East oil, and on
maintaining the Dollar as the World Reserve Currency, and 2) peace and
stability, which the guaranteed access to oil brings to the world. [62]

I find
his statement about the "need" for government secrets to be rather
tautological, circular in logic, and certainly not in the spirit of what the
Founding Fathers stated was imperative to a functioning democracy -- an
informed citizenry. I would suggest to the author and other like-minded
individuals that our nation (including the President) owes the truth to the families
of our soldiers who have been killed or wounded, and to those who continue to
fight and die in Iraq. Additionally, some of us are burdened with a lower
tolerance threshold for hypocrisy when it comes to life and death. In any
event, the author is quite correct that much of our prosperity has been created
by artificial geopolitical arrangements, some of which are slowly coming
unglued.

During
the Cold War and into the present day, the US has supported many dictators and
oppressive regimes in the Middle East that did not always "follow the
`straight line' the US dictates." We seem unable to learn from history.
Indeed, the 2003 Iraq war is the third US-sponsored `regime change' in
Iraq since the end of WWII. [63] Therefore, we must not be naïve
in believing that the Bush administration has any intent of establishing
democratic rule in Iraq, assuming it is possible. As Americans, we have engaged
in wishful thinking that somehow the US military was capable of invading Iraq
and "installing" democracy. We are an Empire trying to reaffirm our
position as the world's only Superpower, thus altruism is not our goal. Our
goal in Iraq is to install a pliant/puppet-regime. The facts on the ground in
Iraq speak for themselves:

The US
ended UN control of Iraq's oil revenue and quickly changed Iraq's oil
transaction currency from euros back to dollars, just as I predicted they would
a year ago . . .

Paul
Bremer unilateral blocked municipal elections that were to held in Iraq in June
2003 (He basically implied that the `outcome' of elections would not be
preferable to the U.S.)

The
neoconservatives threatened Iran and Syria during the Iraq war despite the fact
that Al Qaeda is an organization financed by Saudi Arabians who promote
intolerant Whabbism.

The
neoconservatives have alienated most of the world due to their unilaterism and
overtly vindictive actions regarding Iraq's reconstruction contracts (In
December 2003 Paul Wolfowitz released a document barring non-coalition nations
such France, Russia, Germany, Canada and Mexico from participating in Iraqi
reconstruction projects)

Simply
put, we cannot win this war from a strategic point, and we desperately need the
U.N to involve itself in Iraq. It is the U.S. soldiers whose morale is
suffering the worse, they believed their mission was to "disarm Iraq"
of its "massive" WMD program, and are now the targets of nationalists
Iraqis. However, because the current administration went to war without
approval of the U.N. Security Council, the US has placed the UN in the position
that active support of the United States and U.K. in Iraq would in effect
legitimize the U.S. invasion. If truth be told, numerous international lawyers
have opined the US/UK led invasion meets the definition of a "war of
aggression," implying the war violated the United Nations Charter, and was
illegal. [64]

Hence,
the UN is now in a very uncomfortable position. Irrefutably, unless the current
US administration agrees to relinquish some of its power in Iraq, thereby
allowing the UN and world community to participate in the rebuilding of Iraq,
along with a coordinated withdrawal of most US soldiers in exchange for
international troops wearing the distinct light-blue UN helmets, we should expect
nothing but a very ugly, protracted and costly guerilla war with Iraqi
nationalists. Time is not on our side, the longer we are seen as unilateral
occupiers who have come to Iraq to `seize the oil,' the more highly radicalized
Iraqi society will become. Likewise, we should also learn from our own history
in Iran that despotic US puppets often get overthrown in due time.

As for
the ongoing guerilla/resistance war in Iraq, this should have been expected
given Iraq's nationalistic inclinations/history. Although most of the Iraqis
are glad Saddam is gone, they will not tolerate an extended presence of
American troops in Iraq unless the U.N. and some sort of legitimate Iraqi
governing body control these troops. The lack of UN involvement negates the
legitimacy required for the current US military presence in Iraq. US
unilaterism has produced not only a quagmire for our soldiers, but a magnet for
young Islamic' jihadis.' [65]

Regarding
the US military, it was reported in the Stars and Stripes that 49% of
the participants in the survey were not going to re-enlist. [66] Morale is very low, and those
whom I have spoken to no longer believed "in their mission." Aside
from the budget deficits and war related expenses that are pushing our nation
further into debt, it is becoming increasingly obvious that we need a bigger
military to fulfill the stated objectives of the neoconservative dream of
"Global Empire." After nine months in Iraq, it is clear that by the
spring of 2004 the US military will run out of fresh reserves. Other than a few
nations, most of the world community is not going to send troops into Iraq because
they do not want the neoconservatives to pursue their global Geostrategy, and
it appears the UN does not want to legitimize the concept of "preventative
war" either.

According
to various reports, our regular army and reserves appear very unhappy about
these extended deployments -- as it is often financially painful, sometimes
destroys families, and it is difficult to fight a war to disarm Iraq -- when no
WMD seem to exist. [67] Obviously the current
administration would prefer to avoid any discussion of the draft until after
the 2004 Elections. Nonetheless, unless in early 2004 other nations suddenly
begin sending thousands of troops into Iraq, conscription may become necessary
-- even under a Democratic President in 2005. Obviously the draft will be
highly controversial. Indeed, in order to successfully enact the draft; a new
and ominous existential threat would have to emerge. Given that the
neoconservative conspiracy behind Iraq and the OSP has been exposed, I doubt
even the Bush administration will be able to succeed in scaring the American
people into the necessity of conscription.

For those
who remain skeptical that a draft is being considered, the Selective Service
website provides information suggesting the President has requested that
activation of draft be available within 75 days of Congressional authorization.
A careful reading suggests June 15, 2005 is the target date. After 30 years of
dormancy, why else would the Selective Service suddenly request $29 million in
order to bring the US draft apparatus up to 90% operational capability? [68]

Undoubtedly,
the requirements for Global Empire and five more wars will require many more
soldiers. The neoconservatives have a plan for global domination, but their
execution has been poor and incredibly arrogant. It is interesting to note that
in September 2003 the Directorate for Special Operations and Low-Intensity
Conflict at the Pentagon showed the controversial movie from the 1960s The
Battle for Algiers. The invitation at the Pentagon stated the following:

"How
to win a battle against terrorism and lose the war of ideas. Children shoot
soldiers at point-blank range. Women plant bombs in cafes. Soon the entire Arab
population builds to a mad fervor. Sound familiar? The French have a plan. It
succeeds tactically, but fails strategically. To understand why, come to a rare
showing of this film." [69]

Based on
a story from the Common Dreams website,
the idea came from a civilian-led group with "responsibility for thinking
aggressively and creatively" on issues of guerrilla war. The Pentagon
employee stated, "Showing the film offers historical insight into the
conduct of French operations in Algeria, and was intended to prompt informative
discussion of the challenges faced by the French." It should also be noted
that former U.S. National Security Adviser Zbigniew Brzezinski also recommended
this same movie the following month after the Pentagon screening. In an October
2003 speech Brzezinski stated: "If you want to understand what's happening
right now in Iraq, I recommend The Battle for Algiers." [70]

Another
issue addressed in my original essay was the possibility of Iran moving towards
a petroeuro for oil exports. A June 2003 article in the Hindu Business Line
confirmed my earlier prediction regarding Iran's imminent movement towards the
euro. Dr Mohammed Jaffar Mojarrad, Vice-Governor of the Iranian Central Bank stated
for this article that Iran actually made the switch to the euro for its oil
payments in the summer of 2003. Although Iranian oil is still priced in
dollars, the payment for its oils exports to the EU is now denominated in
euros.

"Iran's
oil and gas exports destined mostly for Europe are already denominated in
euros. Iran produces about 3.5 barrels and is the second largest oil exporter
among the Organisation of Petroleum Exporting Countries (OPEC). About 30 per
cent of the Iran's oil exports are destined for European markets. The other two
large consumers of Iranian Oil are India and China. Even in the case of Indian
only a small quantum of the oil imports come through the ACU mechanism.

But, he
added, the switch to the euro, which as done during the last few months had
helped the country to negate the effects of a depreciating dollar and falling
international oil prices. He said that if the country had continued its
receipts in US dollars, it would have meant large losses, which would have
translated into domestic inflation. This was because large volumes of its
imports are also sourced from Europe. The Iranian central bank was keen to
avert that situation and had consequently adopted the euro-denominated payments
to ensure that the losses were minimised. The country had also resorted to
managing its reserves to minimise the effects of the depreciating dollar, he
added. [71]

Given the
continuing devaluation of the dollar, pressure will build within OPEC to switch
to the euro. The central impediment to such a switch is that all three
internationally traded crude oil pricing "markers" are currently
denominated in dollars (West Texas Intermediate crude, Norway Brent crude and
UAE Dubai crude). Given the rapid decline of oil output from the North Sea, it
is possible another crude marker could emerge later this decade, perhaps
denominated in euros. It is also possible that during 2004-2005 OPEC could
decide to denominate oil in a "basket of currencies," which would
include the euro. OPEC contemplated this idea in the early 1970s after the US
dollar devalued following the collapse of the Bretton Woods Agreement. [72]

Certainly
one of the most interesting and troubling pieces of news regarding the
dollar/euro issues and the potential political fallout from the unauthorized
Iraq war relates to Russia. In mid-October 2003, after meeting with German
Chancellor Gerhard Schroeder, Russian President Vladimir Putin mentioned that
Russian oil sales could be re-denominated in euros.

"We
do not rule out that it is possible. That would be interesting for our European
partners," Putin said at a joint news conference with German Chancellor
Gerhard Schroeder in the Urals town of Yekaterinburg, where the two leaders
conducted two-day talks.

"But
this does not depend solely on us. We do not want to hurt prices on the
market," he said.

A move by
Russia, as the world's second largest oil exporter, to trade oil in euros,
could provoke a chain reaction among other oil producers currently mulling a
switch and would further boost the euro's gradually growing share of global
currency reserves.

That
would be a huge boon to the euro zone economy and potentially catastrophic for
the United States. Dollar-based global oil trade now gives the United States
carte blanche to print dollars without sparking inflation -- to fund huge
expenses on wars, military build-ups, and consumer spending, as well as cut
taxes and run up huge trade deficits.

Almost
two-thirds of the world's currency reserves are kept in dollars, since oil
importers pay in dollars and oil exporters keep their reserves in the currency
they are paid in. This effectively provides the U.S. economy with an
interest-free loan, as these dollars can be invested back into the U.S. economy
with zero currency risk.

If a
Russian move to the euro were to prompt other oil producers to do the same, it
could be a "catastrophe" for the United States, Ibrahim said.
"There are already a number of countries within OPEC that would prefer to
trade in euros." [73]

Continuing
in this same Moscow Times article, two other pieces of vital information
were revealed. If Saudi Arabia were evaluating a "petroeuro," it
would imply major geopolitical and macroeconomic shifts. Although I doubt Saudi
Arabia would make this switch, we shall see . . .

"And
after the war in Iraq, there is growing debate in the United States'
traditional ally Saudi Arabia on a switch too, though its government has not
come down firmly on one side, Ibrahim said. "There is a revision going on
of its strategic relationship with the United States. Already, they're buying
more [French-made] Airbuses," he said. "The Saudi Crown Prince
[Abdullah Bin Abdul Aziz Al-Saud]'s visit to Russia was of great significance
and the regime is talking about closer cooperation with LUKoil and other
Russian companies."

Furthermore,
this article candidly reinforced my original thesis that the creation of a
"petroeuro" was indeed one of the core reasons for the 2003 US/UK
invasion of Iraq.

Under
Saddam Hussein, Iraqi oil was traded in euros. "This was another reason
[why the U.S. attacked]," Ibrahim said. "There is a great political
dimension to this. Slowly more power and muscle is moving from the United
States to the EU, and that's mainly because of what happened in Iraq," he
said.

Putin had
previously brought up the proposal to switch to euros as prime minister in
October 1999, at a meeting of EU leaders in Helsinki. Then, in an attempt to
forge a new bloc to counterbalance the United States, he made the proposal
alongside calling for closer cooperation between Russia and the EU, including
on security issues.

Since
then, however, Russia's ties with the United States have warmed considerably --
and it is unclear whether Putin would risk damaging that relationship by going
ahead with the euro move, analysts said.

. . .
Yevgeny Gavrilenkov, chief economist at Troika Dialog and an earlier architect
of the Putin government's first economic plan, said debate is growing on a move
to the euro as Russia mulls siding with the EU. "Such an idea is really possible,"
he said. "Why not? More than half of Russia's oil trade is with Europe.
But there will be great opposition to this from the United States."

. . .
LUKoil vice president Leonid Fedun said Thursday that he saw no problem in the
euro switch and that payments for such transactions would be minimal, at just
0.08 percent.

The
proposition that Russia, currently the 2nd largest oil exporter, switching to
the euro will be met with "great opposition" from the United States
is quite an understatement. Nevertheless, according to the above excerpts, from
a purely monetary and trade perspective a Russian switch to the euro appears
logical. Obviously the US government would prefer Russia sell its oil in
dollars or a dual currency arrangement. It would highly advisable for the US to
negotiate and compromise with Russia regarding access to Iraq's oil and the
issues regarding Iraqi debts.

Also, a
Russian oil executive suggested that oil from the Urals region in Russia could
become an `alternative crude oil marker' with respect to internationally traded
oil contracts. This may be unlikely given that Russia's Peak Oil production
occurred in 1987, but such an event could provide a new euro-based oil pricing
mechanism. Regardless, by the end of this decade I suspect Norway and Sweden
will likely ascend to the euro, thus facilitating the Brent crude marker being
re-denominating in the euro. There appears to be fall-out from the Iraq war in
some countries that are not under US control. In April 2003 Bloomberg News
reported that Indonesia, a small non-OPEC producer with a Muslim majority was
evaluating a "petroeuro."

"Pertamina,
Indonesia's state oil company, dropped a bombshell recently. It's considering
dropping the U.S. dollar for the euro in its oil and gas trades.

Other
Asian countries may not be far behind any move in Indonesia to dump the dollar.
The reasons for this are economic and political, and they could trigger a
realignment that undermines U.S. bond and stock markets over time." [74]

Additionally,
some articles have suggested that other countries such as Malaysia may soon be
dropping the dollar in favor of the euro. These countries perceive that
switching to the euro will eventually diminish our ability to pursue an agenda
of global militant Imperialism. In fact, it appears that a disconcerting
"anti-dollar" movement could be spreading. Indeed, in 2003 a Wall
Street Journal reporter witnessed an unusual anti-war protest in Nigeria, an
OPEC member.

The Bush
administration probably believes the occupation of Iraq and the installation of
large and permanent U.S. military bases in Iraq will thwart remaining OPEC
producers from even considering switching the denomination of their oil sales
from dollars to euros. However, using the military to enforce dollar hegemony
for oil transactions strikes me as a rather unwieldy and inappropriate
Geostrategy. Regrettably, President Bush and his neo-conservative advisors
appear to have chosen to apply a military option to a U.S. economic problem
that requires a multilateral treaty. History may not look kindly upon their
actions.

Paradoxically,
for a variety of economic and political reasons, it appears that a growing
number of oil producers in the Middle East, South America, and Russia may wish
to transition their oil pricing from dollars to euros, or perhaps denominate
oil in a "basket of currencies." Disturbingly, we may be witnessing
the emergence of a European-Russian-OPEC alliance in an effort to counter
American militant imperialism. Although you will not hear it spoken publicly,
the broad international movement away from the dollar may be an effort to
facilitate "regime change" here in the U.S. Indeed, if the dollar's
steep devaluation in 2004 parallels 2003, every American will suffer for the
misguided policies of our government. We need to quickly change course.

Despite
the current stock market "rally", there is much to be concerned about
regarding the long-term structural imbalances of our economy, and the Bush
administration's flawed tax, economic and most principally their overtly
Imperialist foreign polices could place the dollar's status as the World
Reserve currency and/or oil transaction currency role in jeopardy, or at the
very least significantly diminished over the next few years. In the event that
such a hypothesis materializes, the U.S. economy will require restructuring in
some manner to account for the reduction of either of these two pivotal
advantages. This will be an exceedingly painful process if it occurs in a
disorderly manner, perhaps reminiscent of the 1930's Great Depression.
Certainly a multilateral treaty recognizing these issues would be preferable before
the onset of serious economic dislocations -- or warfare.

Only time
will tell what will happen in the aftermath of the Iraq war and U.S.
occupation, but I am confident my research will contribute to the historical
record and help others understand some of the important but unspoken reasons
for why we conquered Iraq. Regrettably, until the U.S. agrees to a more
balanced Global Monetary system, and embarks on a viable National Energy
Strategy, our nation will continue to pursue hypocritical foreign policies
incompatible with the principles established by the founding fathers regarding
democracy, liberty and freedom.

Conclusion

In
conclusion, the Iraq war was designed to 1) secure U.S./U.K. oil supplies
before and after global Peak Oil, and 2) to have a large military presence to
"dissuade" other oil-producers from moving towards the euro as an oil
transaction currency. These are the two crucial elements for maintaining U.S.
hegemony over the world economy. Reconverting Iraq back to the petrodollar was not
the critical issue, but preventing any further momentum towards a petroeuro is
a critical component of current US Geostrategy. While deceiving the American
people into war, this administration sent a message to other OPEC-producers -- "You
are either with us or against us."

However,
in the end I predict the rules of economics and the laws of physics will
prevail over the dreams of Global Empire. It will be increasingly
"sensible" for OPEC to re-denominate oil sales in euros once the EU
expands in 2004. [76] Additionally, Peak Oil will
usher in an era in which demand for oil will forever outstrip supply. The
neoconservatives understand what this means -- the end of US Hyper power, and
thus the end of their dreams of a US Global Empire. The true test of US
leadership and the citizenry will be acknowledging that our nation will soon
endure some economic hardship. Everyone on earth will be impacted by Peak Oil,
and given that reality -- multilaterialism rather than unilateralism is the
only way to create a peaceful outcome.

First,
the industrialized economies need to develop new energy policies and
technologies, but here in the US we have the most to lose due to our high
consumption rate and structural debt problems. In fact, out entire
"suburban" infrastructure was designed for the utilization of
automobiles and we do not have enough mass transit in place when Peak Oil
arrives. We have a lot of work to do, not enough time, and too much
debt, which further reduces our options. Secondly, our currency is challenged
for the first time since WWII with an alternative -- the euro.

So, we
have been reduced to using military force to maintain our hegemonic status, but
under the neoconservatives we are doing it in such an overt, arrogant way that
the world community is objecting. Disparaging the United Nations while
unsuccessfully bribing our allies to support the Iraq war is a radical
departure from decades of US diplomatic policy. Furthermore, the world
community is probably more aware of the implications of the Project for a New
American Century than the US citizens are, and the world does not appear ready
to accept the US as a militant, unilateral hyper-power. Neoconservatives fail
to understand that the industrialized world can and will topple us from our
hegemonic status if they perceive us to be a greater threat to world
stability than the economic disruptions that would occur from the displacement
of the dollar standard. Let us hope the world will not allow a disorderly
dollar decline or "panic."

The
dollar is our Achilles Heel, and it will also be our undoing if we do not
change course and compromise with the European Union, otherwise we will
probably have military conscription, political repression and tyranny at home,
and the American Experiment as we have known it for the past 227 years will
end. This need not be the case. What we as citizens must realize is that overt
pursuit of Empire abroad will ultimately result in tyranny at home. We have
already begun this process with the incessant fear mongering, deception and
intolerant portrayal of events surrounding the Iraq war. Furthermore, our civil
rights and Constitutional protections are being dangerously eviscerated
(possible elimination of Posse Comitatus,
along with various hidden provisions within Patriot Acts I & II, Office of Homeland
Security, and various Executive Orders).

The only
way out of this dilemma is international cooperation, real leadership, global
monetary reform and sacrifices by the US citizenry regarding energy
consumption. U.S. Politicians are not interested in being truthful with the
People, as both parties are more or less in the pockets of the military-energy
conglomerates. Real Campaign Finance Reform may be the only way in which the US
can enact the sufficient energy reforms that will be required with the onset of
Peak Oil.

1.In order
to save the American Experiment the neoconservative goal of US "Global
Domination" must be quickly discarded by a new administration. The concept
of the U.S. violating international law with unilateral "preventative
wars" will simply not be tolerated by most industrialized nations.
Hopefully one of the first official acts of the 44th President will be to
officially disavow the "Bush Doctrine" of preventive warfare. Such a
gesture would allow the world community to breath a collective sign of relief,
and extend to the new administration much needed political capital. Multilateral
cooperation will be needed for the following issues/reforms.

2.We must
restore some semblance of fiscal responsibility in this country if we want to
save the dollar. The Iraq conflict has cost the US approximately $300 billion
dollars by the end of 2003, and estimates of current military expenditures are
approximately $1 billion per week. Unlike the 1991 Gulf War, US taxpayers (and
their children and grandchildren) will pay for the 2003 Iraq war. It has been
said that the credit worthiness of a currency is based upon the ability of the
government to collect tax revenue from its citizens. Perhaps the devaluation of
the dollar during 2002-2003 reflects the world community's lack of faith in
this administration's tax policies.

Passing large tax cuts in 2003 while in the midst of a war in Iraq is the
ultimate act of fiscal irresponsibility. The American people appear ignorant of
the historical correlation between wars and taxes. Do we honestly believe we
can afford massive tax cuts along with massive increases in military and
domestic spending? Not even a French socialist would dare to do what we have
done. I suspect 2003 was the first time in modern history that a nation
decreased taxes while in the midst of a major war. We need to dispel with this
ideological and quasi-mystical belief about tax cuts: "Nothing is more
important in the face of a war than cutting taxes." -- Tom Delay
(R-TX)

The IMF and the finance ministers of the world community must think we have
lost our collective minds. I do not envy the fiscal mess the next US President
will inherit. The next President will have the unenviable task of attempting to
balance the current budget deficit, which will require increasing taxes,
perhaps to their pre-2001 levels. Some semblance of fiscal sanity will be required
to support the dollar. While such a tax policy will be wildly unpopular, we
need to face reality, throughout history and into the present day -- wars are
very expensive. We have not yet paid for Afghanistan war, or the Iraq invasion,
it is all borrowed money. To date the price has been a significant devaluation
of our currency. Although our `war taxes' will probably be avoided until after
the 2004 Elections, this is only a temporary respite. Without a UN mandate for
starting the Iraq war, it is inevitable the US citizens will pay heavily for
the Iraq war.

3.The
Federal Reserve may soon be prompted to raise interest rates in an effort to
stem the weakening dollar, but we are in a perilous situation. US corporations
and consumers have acquired so much debt that a rate hike might starve-off
domestic economic growth. A rate increase may cause a lot of pain for average
Americans, but we have lived in the fantasy of huge tax cuts, low-interest
rates, huge budget deficits and a huge trade account deficit for much too long.
Militant Empires have never been cheap. The wildcard seems to be the dollar,
which is being rapidly debased. Exactly how much pain will occur when and if
the Federal Reserve increases the lending rates above 1.0% is unknown. In a best-case
scenario, the Fed would spread this pain over several years, but dollar
devaluation will probably occur precipitously.

4.Propose
to the UN to form an International Consortium of energy scientists &
researchers from all over the globe to develop alternative fuels for
transportation. Could be a combo of biomass, fuel cells, renewables, etc. The
US, as the greatest energy consumer, must show leadership in developing and
promoting alternatives. Along with rejecting the Bush Doctrine, this will do
much to repair our international image. Imagine the Manhattan Project but on an
international scale, hopefully a $50+ billion yearly international effort
beginning in 2005. Redirecting funds and brainpower from our military R&D
is warranted. We don't have much time, as some have suggested we may have
arrived at a plateau in global oil production . . .

5.The U.N.
should form an International Group of scientists and engineers to study energy
depletion stemming from global Peak Oil. Considerable financial resources
totaling tens of billions should provide to this Group by the International
community. The UN should also devise some type of methodology regarding the
distribution of hydrocarbons. This will be an equally contentious and difficult
reform to achieve, but the only alternative is either oil warfare in the
Persian Gulf, or economic warfare in the international foreign exchange
markets. Both of these adverse outcomes can be avoided if the international
community can agree to some sort of complex energy formula that reflects
economic output and population growth statistics.

The UN should attempt to establish guidelines, along with an enforcement
mechanism based on energy price. The bottom line is the US needs to use less
energy, and we need to immediately begin improving our infrastructure before
the full effects of Peak Oil make our energy reforms excessively painful and
expensive. Given that we consume 25% of the world hydrocarbons, we have both
the most to gain and most to lose if energy reforms are not implemented during
this decade. Mother Nature and Peak Oil will not wait for the scientists or the
politicians to act . . .

6.Global
monetary reform: A painful but absolutely necessary reform to
"rebalance" the global economy. The US consumer cannot go into indefinite
debt as the single engine for global growth, nor can the Federal Reserve
continue to "re-inflate" the bubbles into perpetuity. Economists such
as Stephen Roach (Morgan Stanley) and Richard Duncan (author of The Dollar
Crisis [77])
have suggested the excessive growth of global credit in conjunction with the
structural problems of the US dollar may create a deflationary contraction of
the global economy. In other words, a deflationary depression could occur with
a significant devaluation/ panic on the dollar, and the downturn will be very
long lasting unless the global aggregate demand increases. The G8 nations
should begin the process of global monetary reform. However, I remain skeptical
these reforms will take place until a truly significant crisis unfolds

Regardless, the global economy will be more balanced and better off with three
engines of global growth: the US, the EU and Asia. First reform should be the
euro as the 2nd International Reserve currency, at parity with the dollar,
thereby allowing a dual-OPEC oil transaction currency standard. This should
join the US with the EU as two equal "co-hegemons."

At some point a third world reserve currency will make sense for the Asian
bloc, perhaps a Yuan/Yen currency around 2010 that allows China and Japan to
purchase oil with their own reserve currency. These reforms are obviously very
controversial proposals, but again, I fear that failure to compromise on these
monetary issues will ultimately result in a dangerous and unstable multi-polar
world engaged in global oil and/or economic warfare. It is preferable to begin
negotiations that compromise on these monetary/energy issues via multilateral
accords before things get desperate in the post-Peak Oil environment.

Under the
above scenarios regarding monetary reform, we may have to reduce our overblown
military expenditures by a considerable amount, perhaps 50% ("only"
$200 billion per year), and spend our tax revenues on reducing our debts and
improving our energy infrastructure for a less energy intensive existence. That
transition will undoubtedly be difficult for those who drive large SUVs, but
our choices are increasingly limited. The past few generations including the
Baby Boomers, Generation X or Generation Y, all grew-up with the US as a
Superpower. To even imagine a different scenario -- where the US shares power
with the EU as an equal (and ultimately with China) creates cognitive
dissonance. However the "Greatest Generation," to which my
grandparents belong, grew-up when America was not a superpower, and they
endured hardships that strengthened their characters. We too must adapt to new
realities.

My
principal concern at is time? Has our nation become too militarized and too
fearful of shadowy enemies supposedly lurking inside every airplane or foreign
nation? (Similar to the German population of the 1930s) Will we be able to
willingly overcome our irrational fear, and peacefully make some painful but
necessary adjustments to our economy and society? As Mr. Brzezinski noted, it
is troubling the US has acquired a rather "paranoiac" view of the
world. [78] We must throw off such fears and
be realistic, it is we who have changed, not the world. Indeed, no
industrialized or developing nation wants the US economy to collapse. They
admire our technical base, R&D capability, education system, and of course
they need us as consumers.

However,
what the world community realizes is the `war on terrorism' is a cynically
strategy used by the Bush administration to reaffirm the US status as the
global hegemonic Empire. This is a dangerous policy. Our problems with Al Qaeda
are based on a few radical zealots who distort religion to justify their
crimes. While terrorist tactics are utterly cruel and never justifiable, there
are often causes for their anger, usually political grievances. Bin Laden does
not "hate our freedoms" -- according to his own words he hates our
foreign policies. He is a violent "anti-imperialist militant
Islamist." Bin Laden is a product of Whabbism, but his views grotesquely
distort Islam. This intolerant version of Islam is practiced only in Saudi
Arabia and by Saudi-financed madrassas in Pakistan. Saudi Arabia needs to
undertake immense internal political and social reform, and perhaps resolving
the Israeli-Palestinian conflict could facilitate reform.

In truth,
apprehending Al Qaeda members and reducing terrorism will require massive
international cooperation via joint intelligence/police operations involving
the US, EU, Africa, central Asia and the Middle Eastern states. I suggest that
a highly empowered INTERPOL (International Police) operation would produce the
least amount of "blowback" in a worldwide anti-terrorism
campaign. [79] According to senior FBI agents,
as of late 2002 there were only about 200 hard-core Al Qaeda members still
at large. [80] In comparison, Al Capone's
infamous Chicago mafia had about two to three times as many members as Al
Qaeda. However, the FBI did not bomb Sicily during our `war against organized
crime.' We cannot stop Al Qaeda by bombing or via "regime change."
The situation in post-Saddam Iraq is a prime example of this dangerously flawed
ideology, as we have created terrorists where they did not previously exist.

We must
acknowledge that terrorism has and will exist as long as man walks the earth,
so we must live in dignity, not in fear. Reducing ignorance and oppression that
breeds fear and hatred will reduce future recruits for terrorist groups. We
must frame international terrorism as acts of crimes against
humanity, committed by a small number of criminals. We need to adjust
our perception accordingly, and work diligently together within the
international framework.

Moreover,
we must also face the facts regarding one of the prime causes of
anti-Americanism in the Middle East. If the Isreali-Palestinain conflict is
resolved peacefully via a two-state solution, the humiliation in the general
Arab population will eventually subside, allowing much needed political reform.
Both the Israelis and the Palestinians are entitled to live in peace, security,
and prosperity. Although some will argue differently, objective observers
realize that a peaceful resolution to the Isreali-Palestinan issue is one of
the most critical components to winning the campaign against terrorism. I pray
the next US President will succeed in achieving this goal.

I believe
the real struggle in the US is more internal than external. If we truly
practiced our values as majestically articulated in the Declaration of
Independence, Constitution
and Bill of
Rights, we would have the world's respect, not the world's fear and
loathing. Overcoming the current "anti-Americanism" requires a
balanced foreign policy regarding Israel, and a viable National Energy Strategy
that will allow us to stop supporting repressive regimes. The key is a policy
of sustained energy reform -- which would then allow more enlightened
foreign policies -- just as the founding fathers envisioned. Our struggle? Can
we return to our republican origins and restrain ourselves from seeking Empire?
Can we rejoin the community of industrialized nations -- as an equal to the EU?
The ultimate test for the American Experiment? Can we once again begin living within
our means -- from both fiscal and energy perspectives? If we can do that, our
problems with today's "anti-Americanism" and tomorrow's terrorist
will quickly subside.

Quite
frankly, in order to save the American Experiment and stop our slide towards an
isolated and authoritarian state, we must elect an enlightened administration
in 2004. It would appear that four difficult challenges await the next U.S.
administration, including; 1) negotiating global monetary reform, 2) broadly
re-organizing U.S. fiscal policies, 3) developing a National Energy Strategy,
and 4) attempting to repair our damaged foreign relationships with the UN, EU,
Russia, and the Middle East. Sadly, the next U.S. President will have to
undertake these challenges from a weakened position both economically and
diplomatically. I do not envy the arduous journey that awaits the 44th
President of the United States.

Dear
readers, it is not hyperbole to suggest the destiny of the United States may
very well be determined by the 2004 Elections. We are at an epochal moment in
history. The reality is the beginning of the 21st century will either be a
disastrous time period of oil related military and economic warfare, or a noble
effort at international cooperation via global energy and monetary reform. The
choice is ours: Will we desperately fight for Empire under the guise of the
"war on terror" -- or will we heed the wisdom of founding fathers by
"resisting the temptation" of Empire -- and compromise for Peace? The
path we choose in November 2004 will determine not only our future, but also
the future of millions of people around the world.

*************************************

"America
will never be destroyed from the outside. If we falter and lose our freedoms,
it will be because we destroyed ourselves."

"I
am a firm believer in the people. If given the truth, they can be depended upon
to meet any national crisis. The great point is to bring them the real
facts."

-Abraham Lincoln

I have
sworn upon the altar of God eternal hostility against every form of tyranny
imposed upon the mind of man."

-- Thomas
Jefferson

# # #

References (post-war commentary)

49.Dreyfuss, Robert and Vest, Jason,
"The Lie Factory," Mother
Jones, February 2004

. . . The
[euro encroaches] upon the hegemony of the US dollar. . . . Wall Street is
clashing with competing Franco-German financial interests. The war in Iraq
pertains not only to control over [oil] reserves[, but also] the control over
[currency,] money creation and credit. . . .

The
European common currency system has a direct bearing on strategic and political
divisions. London's decision not to adopt the common currency is consistent
with the integration of British financial and banking interests with those of
Wall Street, not to mention the Anglo-American alliance in the oil industry
(BP, Exxon-Mobil, Texaco Chevron, Shell) and weapons production (by the
"Big Five" US weapons producers plus British Aerospace Systems). This
shaky relationship between the British pound and the US dollar is an integral
part of the Anglo-American military axis.

What is
at stake is the rivalry between two competing global currencies: the euro and
the US dollar, with Britain's pound being torn between the European and the
US-dominated currency systems. In other words, two rival financial and monetary
systems are competing worldwide for the control over money creation and credit.
The geopolitical and strategic implications are far-reaching because that are
also marked by splits on the Western defense industry and the oil business.

In both
Europe and America, monetary policy, although formally under State
jurisdiction, is largely controlled by the private banking sector. The European
Central Bank based in Frankfurt -- although officially under the jurisdiction
of the EU -- is, in practice, overseen by a handful of private European banks
including Germany's largest banks and business conglomerates.

The . . .
Federal Reserve Board is formally under State supervision -- marked by a close
relationship to the US Treasury. Distinct from the European Central Bank, the
12 Federal Reserve banks (of which the Federal Reserve Bank of New York is the
most important) are controlled by their shareholders, which are private banking
institutions. In other words, "the Fed" as it is known in the US,
which is responsible for monetary policy and hence money creation for the
nation, is actually controlled by private interests on Wall Street.

Currency
Systems and `Economic Conquest'

. . .
Ultimately, control over national currency systems is the basis upon which
countries are colonized. While the US dollar prevails throughout the Western
Hemisphere, the euro and the US dollar are clashing in the former Soviet Union,
the Balkans, Central Asia, sub-Saharan Africa and the Middle East.

In the
Balkans and the Baltic States, central banks largely operate as colonial style
`currency boards' invariably using the euro as a proxy currency. What thus
means is: German and European financial interests are in control of money
creation and credit. That is, the pegging of the national currency to the euro
-- rather than the US dollar -- means that both the currency and the monetary
system will be in the hands of German-EU banking interests.

More
generally, the euro dominates in Germany's hinterland: Eastern Europe, the
Baltic States and the Balkans, whereas the US dollar tends to prevail in the
Caucasus and Central Asia. In these countries (which have military cooperation
agreements with Washington) the dollar tends (with the exception of the
Ukraine) to overshadow the euro.

The
`Dollarization' of national currencies is an integral part of America's Silk
Road Strategy. The latter consists in first destabilizing and then replacing
national currencies with the American greenback over an area extending from the
Mediterranean to China's Western border. The underlying objective is to extend
the dominion of the Federal Reserve System -- namely, Wall Street -- over a
vast territory.

What we
are dealing with is an `imperial' scramble for control over national . . .
economies and currency systems, they seem to have also agreed on "sharing
the spoils" -- ie. Establishing their respective "spheres of
influence." Reminiscent of the policies of `partition' in the late 19th
Century, the US and Germany have agreed upon the division of the Balkans;
Germany has gained control over national currencies in Croatia, Bosnia and
Kosovo where the euro is King. The US has established a permanent military
presence in the region (i.e. the Bondsteel military base in Kosovo).

·Notes on Project Censored: For the
past several years, journalism students and faculty at the University of
California at Sonoma have reviewed important news stories and published an annual
book on stories that never "made the news." This past year 150
faculty and students reviewed a total of 900 stories for the 2003 publication.
My essay, `Real Reasons for the Upcoming Iraq War' was ultimately awarded by
Project Censor as one of the most important but "censored" news
stories of 2003. Below are links to their website. (A synopsis of my research
is provided in story #19 in their
publication, Censored
2004.)

I would like to thank Dr. Peter Phillips for his ongoing efforts at Project
Censored. None of the authors published in `Censored 2004' receive any
financial compensation (only infamy), but if you would like a glimpse as to how
our 6 US media conglomerates profoundly censor our news, I recommend this book:

Over the past few years I have often been amazed by the degree to which
the American public remains willingly uninformed, and despite my skepticism, I
sometimes wonder about the validity of this statement.